10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2012

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 000-14993

CARMIKE CINEMAS, INC.

(Exact Name of Registrant as Specified in Its Charter)

DELAWARE	58-1469127
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
1301 First Avenue, Columbus, Georgia	31901-2109
(Address of Principal Executive Offices)	(Zip Code)

(706) 576-3400

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

Indicate the number of shares outstanding of the issuer’s common stock, as of the latest practicable date.

Common Stock, par value $0.03 per share — 17,776,617 shares outstanding as of July 25, 2012.

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)		3
CONDENSED CONSOLIDATED BALANCE SHEETS		3
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS		4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS		5
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		6
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		23
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		31
ITEM 4. CONTROLS AND PROCEDURES		31
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS		32
ITEM 1A. RISK FACTORS		32
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		32
ITEM 3. DEFAULTS UPON SENIOR SECURITIES		32
ITEM 4. MINE SAFETY DISCLOSURES		32
ITEM 5. OTHER INFORMATION		32
ITEM 6. EXHIBITS		33
EXHIBIT INDEX		33
SIGNATURES		35
EX-31.1 SECTION 302 CERTIFICATION OF CEO
EX-31.2 SECTION 302 CERTIFICATION OF CFO
EX-32.1 SECTION 906 CERTIFICATION OF CEO
EX-32.2 SECTION 906 CERTIFICATION OF CFO

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CARMIKE CINEMAS, INC. and SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands except share and per share data)

	June 30,			December 31,
	2012			2011
	(Unaudited)
Assets:
Current assets:
Cash and cash equivalents	$	85,779		$	13,616
Restricted cash		17			331
Accounts receivable		5,659			4,985
Inventories		2,945			2,955
Prepaid expenses and other current assets		8,994			9,410
Total current assets		103,394			31,297
Property and equipment:
Land		53,695			53,909
Buildings and building improvements		273,148			276,221
Leasehold improvements		121,607			123,547
Assets under capital leases		44,970			44,970
Equipment		214,664			212,457
Construction in progress		3,535			2,349
Total property and equipment		711,619			713,453
Accumulated depreciation and amortization		(364,059	)		(357,518	)
Property and equipment, net of accumulated depreciation		347,560			355,935
Goodwill		8,087			8,087
Intangible assets, net of accumulated amortization		1,115			1,169
Investments in unconsolidated affiliates (Note 10)		6,503			8,498
Other assets		21,824			17,870
Total assets	$	488,483		$	422,856
Liabilities and stockholders’ equity:
Current liabilities:
Accounts payable	$	22,649		$	29,583
Accrued expenses		33,181			31,136
Current maturities of long-term debt, capital leases and long-term financing obligations		2,122			3,959
Total current liabilities		57,952			64,678
Long-term liabilities:
Long-term debt, less current maturities		209,512			196,880
Capital leases and long-term financing obligations, less current maturities		113,720			114,608
Deferred revenue		33,567			34,009
Other		17,251			18,306
Total long-term liabilities		374,050			363,803
Commitments and contingencies (Note 7)
Stockholders’ equity (deficit):
Preferred Stock, $1.00 par value per share: 1,000,000 shares authorized, no shares issued		—			—
Common Stock, $0.03 par value per share: 35,000,000 shares authorized, 18,233,847 shares issued and 17,776,617 shares outstanding at June 30, 2012, and 13,419,872 shares issued and 12,966,942 shares outstanding at December 31, 2011		539			401
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively		(11,740	)		(11,683	)
Paid-in capital		348,593			290,997
Accumulated deficit		(280,911	)		(285,340	)
Total stockholders’ equity (deficit)		56,481			(5,625	)
Total liabilities and stockholders’ equity (deficit)	$	488,483		$	422,856

The accompanying notes are an integral part of these condensed consolidated financial statements.

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CARMIKE CINEMAS, INC. and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenues:
Admissions	$	86,936		$	84,680		$	170,126		$	145,720
Concessions and other		49,355			46,794			96,872			81,467
Total operating revenues		136,291			131,474			266,998			227,187
Operating costs and expenses:
Film exhibition costs		48,533			46,623			92,040			78,699
Concession costs		5,510			5,329			11,102			9,195
Other theatre operating costs		52,707			49,448			105,254			98,461
General and administrative expenses		5,174			4,496			10,174			9,229
Severance agreement charges		493			845			493			845
Depreciation and amortization		7,756			7,874			15,542			15,662
Loss on sale of property and equipment		—			80			248			60
Write-off of note receivable		—			750			—			750
Impairment of long-lived assets		50			1,164			1,536			1,325
Total operating costs and expenses		120,223			116,609			236,389			214,226
Operating income		16,068			14,865			30,609			12,961
Interest expense		8,611			8,631			16,874			17,784
Loss on extinguishment of debt		4,961			—			4,961			—
Income (loss) before income tax and (loss) income from unconsolidated affiliates		2,496			6,234			8,774			(4,823	)
Income tax expense (Note 4)		918			794			3,332			7,289
(Loss) income from unconsolidated affiliates (Note 10)		(448	)		497			(992	)		(304	)
Income (loss) from continuing operations		1,130			5,937			4,450			(12,416	)
Income (loss) from discontinued operations (Note 6)		68			(54	)		(21	)		(99	)
Net income (loss)	$	1,198		$	5,883		$	4,429		$	(12,515	)
Weighted average shares outstanding:
Basic		16,963			12,796			14,894			12,790
Diluted		17,364			12,827			15,147			12,790
Net income (loss) per common share (Basic):
Income (loss) from continuing operations	$	0.07		$	0.46		$	0.30		$	(0.97	)
Loss from discontinued operations, net of tax		—			—			—			(0.01	)
Net income (loss)	$	0.07		$	0.46		$	0.30		$	(0.98	)
Net income (loss) per common share (Diluted):
Income (loss) from continuing operations	$	0.07		$	0.46		$	0.29		$	(0.97	)
Loss from discontinued operations, net of tax		—			—			—			(0.01	)
Net income (loss)	$	0.07		$	0.46		$	0.29		$	(0.98	)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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CARMIKE CINEMAS, INC. and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Six Months Ended June 30,
	2012			2011
	(Unaudited)			(Unaudited)
Cash flows from operating activities:
Net income (loss)	$	4,429		$	(12,515	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		15,571			15,768
Amortization of debt issuance costs		1,035			1,959
Impairment on long-lived assets		1,536			1,325
Loss on extinguishment of debt		4,961			—
Stock-based compensation		1,101			1,188
Loss from unconsolidated affiliates		1,702			304
Other		205			318
Write-off of note receivable		—			750
Loss (gain) on sale of property and equipment		124			(173	)
Changes in operating assets and liabilities:
Accounts receivable and inventories		(1,447	)		(1,530	)
Screenvision receivable		—			30,000
Prepaid expenses and other assets		209			(246	)
Accounts payable		(5,761	)		759
Accrued expenses and other liabilities		2,258			3,292
Distributions from unconsolidated affiliates		206			205
Net cash provided by operating activities		26,129			41,404
Cash flows from investing activities:
Purchases of property and equipment		(10,626	)		(6,248	)
Release of restricted cash		314			279
Theatre acquisition		(702	)		—
Proceeds from sale of property and equipment		700			444
Net cash used in investing activities		(10,314	)		(5,525	)
Cash flows from financing activities:
Debt activities:
Short-term borrowings		5,000			—
Repayment of short-term borrowings		(5,000	)		—
Issuance of long-term debt		209,500			—
Repayments of long-term debt		(200,229	)		(26,161	)
Debt issuance costs		(8,599	)		(588	)
Repayments of capital lease and long-term financing obligations		(900	)		(962	)
Issuance of common stock		56,633			—
Purchase of treasury stock		(57	)		—
Net cash provided by (used in) financing activities		56,348			(27,711	)
Increase in cash and cash equivalents		72,163			8,168
Cash and cash equivalents at beginning of period		13,616			13,066
Cash and cash equivalents at end of period	$	85,779		$	21,234
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	12,913		$	16,631
Income taxes	$	2,789		$	6,122
Non-cash investing and financing activities:
Non-cash purchase of property and equipment	$	516		$	2,865

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

CARMIKE CINEMAS, INC. and SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and six months ended June 30, 2012 and 2011

(unaudited)

(in thousands except share and per share data)

NOTE 1—BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Carmike Cinemas, Inc. (referred to as “we”, “us”, “our”, and the “Company”) has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”). This information reflects all adjustments which in the opinion of management are necessary for a fair presentation of the balance sheet as of June 30, 2012 and December 31, 2011, the results of operations for the three and six month periods ended June 30, 2012 and 2011 and cash flows for the six months ended June 30, 2012. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011. That report includes a summary of our critical accounting policies. There have been no material changes in our accounting policies during the first six months of 2012.

The consolidated financial statements include the accounts of the Company’s wholly owned subsidiaries. All intercompany transactions and balances have been eliminated.

Accounting Estimates

In the preparation of financial statements in conformity with GAAP, management must make certain estimates, judgments and assumptions. These estimates, judgments and assumptions are made when accounting for items and matters such as, but not limited to, depreciation, amortization, asset valuations, impairment assessments, lease classification, employee benefits, income taxes, reserves and other provisions and contingencies. These estimates are based on the information available when recorded. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are recognized in the period they are determined.

Discontinued Operations

The results of operations for theatres that have been disposed of or classified as held for sale are eliminated from the Company’s continuing operations and classified as discontinued operations for each period presented within the Company’s condensed consolidated statements of operations. Theatres are reported as discontinued operations when the Company no longer has continuing involvement in the theatre operations and the cash flows have been eliminated, which generally occurs when the Company no longer has operations in a given market. See Note 6 – Discontinued Operations.

Impairment of Long-Lived Assets

Long-lived assets are tested for recoverability whenever events or circumstances indicate that the assets’ carrying values may not be recoverable. The Company performs its impairment analysis at the individual theatre-level, the lowest level of independent, identifiable cash flow. Management reviews all available evidence when assessing long-lived assets for impairment, including negative trends in theatre-level cash flow, the impact of competition, the age of the theatre, and alternative uses of the assets. The Company’s evaluation of negative trends in theatre-level cash flow considers the seasonality of the business, with significant revenues and cash flow generated in the summer and year-end holiday season. Absent any unusual circumstances, management evaluates new theatres for potential impairment only after a theatre has been open and operational for a sufficient period of time to allow its operations to mature.

For those assets that are identified as potentially being impaired, if the undiscounted future cash flows from such assets are less than the carrying value, the Company recognizes a loss equal to the difference between the carrying value and the asset’s fair value. The fair value of the assets is primarily estimated using the discounted future cash flow of the assets with consideration of other valuation techniques and using assumptions consistent with those used by market participants. Significant judgment is involved in estimating cash flows and fair value; significant assumptions include attendance levels, admissions and concessions pricing, and the weighted-average cost of capital. Management’s estimates are based on historical and projected operating performance.

6

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to the short-term maturities of these assets and liabilities.

The fair value of the Senior Secured Notes and Credit Facility described in Note 3 – Debt is estimated based on quoted market prices at the date of measurement.

Comprehensive Income

The Company has no other comprehensive income items.

NOTE 2—IMPAIRMENT OF LONG-LIVED ASSETS

For the three and six months ended June 30, 2012, impairment charges aggregated to $50 and $1,536, respectively. The impairment charges were primarily the result of the Company’s plan to replace an owned theatre prior to the end of its useful life and the continued deterioration of previously impaired theatres. The Company recorded impairment charges of $1,164 and $1,325 during the three and six months ended June 30, 2011 which were primarily the result of continued deterioration of previously impaired theatres and a decline in market value of a previously closed theatre.

The estimated aggregate fair value of the long-lived assets impaired during the three and six months ended June 30, 2012 was approximately $870 and $5,677, respectively. These fair value estimates are considered Level 3 estimates and were derived primarily from discounting estimated future cash flows and contracts to sell certain owned properties. Future cash flows for a particular theatre are based on historical cash flows for that theatre, after giving effect to future attendance fluctuations, and are projected through the remainder of its lease term or useful life. The Company projects future attendance fluctuations of (10%) to 10%. The risk-adjusted rate of return used to discount these cash flows ranges from 10% to 15%.

NOTE 3—DEBT

Our debt consisted of the following on the dates indicated:

	June 30, 2012			December 31, 2011
Term loan	$	—		$	200,229
Senior secured notes		210,000			—
Revolving credit facility		—			—
Original issue discount		(488	)		(1,306	)
Total debt		209,512			198,923
Current maturities		—			(2,043	)
Total long-term debt	$	209,512		$	196,880

Senior Secured Notes

In April 2012, the Company issued $210,000 aggregate principal amount of 7.375% Senior Secured Notes due May 15, 2019 (the “Senior Secured Notes”). The proceeds were used to repay the Company’s $265,000 senior secured term loan that was due in January 2016 with a then outstanding balance of $198,700. The Company recorded a loss on extinguishment of debt of $4,961 during the three and six months ended June 30, 2012, for the write-off of unamortized debt issuance costs. Interest is payable on the Senior Secured Notes on May 15 and November 15 of each year, beginning on November 15, 2012.

The Senior Secured Notes are fully and unconditionally guaranteed by each of the Company’s existing subsidiaries and will be guaranteed by any future domestic wholly-owned restricted subsidiaries of the Company. Debt issuance costs and other transaction fees of $8,600 are included in prepaid expenses and other current assets and other non-current assets and amortized over the life of the debt as interest expense. The Senior Secured Notes are secured, subject to certain permitted liens, on a second priority basis by substantially all of the Company’s and the guarantors’ current and future property and assets (including the capital stock of the Company’s current subsidiaries), other than certain excluded assets.

7

At any time prior to May 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the Senior Secured Notes with the proceeds of certain equity offerings at a redemption price equal to 107.375% of the principal amount of the Senior Secured Notes, plus accrued and unpaid interest to, but excluding the redemption date; provided, however, that at least 65% of the aggregate principal amount of the Senior Secured Notes are outstanding immediately following the redemption. In addition, at any time prior to May 15, 2015, the Company may redeem all or a portion of the Senior Secured Notes by paying a “make-whole” premium calculated as described in the indenture governing the Senior Secured Notes (the “Indenture”).

At any time on or after May 15, 2015, the Company may redeem all or a portion of the Senior Secured Notes at redemption prices calculated based on a percentage of the principal amount of the Senior Secured Notes being redeemed, plus accrued and unpaid interest, if any, to the redemption date, depending on the date on which the Senior Secured Notes are redeemed. These percentages range from between 100.00% and 105.53%.

Following a change of control, as defined in the Indenture, the Company will be required to make an offer to repurchase all or any portion of the Senior Secured Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest to, but excluding, the date of repurchase.

Revolving Credit Facility

In April 2012, the Company also entered into a new $25,000 revolving credit facility (the “Credit Facility”) with an interest rate of LIBOR (subject to a 1.00% floor) plus a margin of 4.50%, or Base Rate (subject to a 2.00% floor) plus a margin of 3.50%, as the Company may elect. In addition, the Company is required to pay commitment fees on the unused portion of the Credit Facility at the rate of 0.50% per annum. The termination date of the Credit facility is April 27, 2016. The new $25,000 revolving credit facility replaced the prior $30,000 revolving credit facility that was scheduled to mature in January 2013.

The Credit Facility includes a sub-facility for the issuance of letters of credit totaling up to $10,000. The Company’s obligations under the Credit Facility are guaranteed by each of the Company’s existing and future direct and indirect wholly-owned domestic subsidiaries, and the obligations of the Company and such guarantors in respect of the Credit Facility are secured by first priority liens on substantially all of the Company’s and such subsidiaries’ current and future property and assets, other than certain excluded assets pursuant to the first lien guarantee and collateral agreement by and among the Company, such guarantors and Wells Fargo Bank, National Association, as collateral trustee. In addition, the Credit Facility contains provisions to accommodate the incurrence of up to $150,000 in future incremental borrowings. While the Credit Facility does not contain any commitment by the lenders to provide this incremental indebtedness, the Credit Facility describes how such debt (if provided by the Company’s existing or new lenders) would be subject to various financial and other covenant compliance requirements and conditions at the time the additional debt is incurred. There was no outstanding balance on the revolving credit facility at June 30, 2012.

The fair value of the Senior Secured Notes at June 30, 2012 and the senior secured term loan at December 31, 2011 is estimated based on quoted market prices as follows:

	As of June 30,		As of December 31,
	2012		2011
Carrying amount, net	$	210,000	$	198,923	(1)
Fair value	$	217,400	$	198,247

(1) Term loan is reflected net of unamortized discount of $1,306 at December 31, 2011.

Debt Covenants

The Indenture and the Credit Facility include covenants which, among other things, limit the Company’s ability, and its subsidiaries, to:

• incur additional indebtedness or guarantee obligations;

• issue certain preferred stock or redeemable stock;

• pay dividends up to certain specified limits, repurchase or make distributions in respect of the Company’s capital stock or make other restricted payments;

• make certain investments;

8

• sell, transfer or otherwise convey certain assets;

• create or incur liens or other encumbrances;

• prepay, redeem or repurchase subordinated debt prior to stated maturities;

• designate the Company’s subsidiaries as unrestricted subsidiaries;

• consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets;

• enter into a new or different line of business; and

• enter into certain transactions with the Company’s affiliates.

The restrictive covenants are subject to a number of important exceptions and qualifications set forth in the Indenture and the Credit Facility.

The Indenture provides for customary events of default. If any event of default occurs and is continuing, subject to certain exceptions, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding Senior Secured Notes may declare all the Senior Secured Notes to be due and payable immediately, together with any accrued and unpaid interest, if any, to the acceleration date. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization, such amounts with respect to the Senior Secured Notes will be due and payable immediately without any declaration or other act on the part of the trustee or the holders of the Senior Secured Notes.

The Credit Facility contains further limitations on the Company’s ability to incur additional indebtedness and liens. In addition, to the extent the Company incurs certain specified levels of additional indebtedness, further limitations under the Credit Facility will become applicable under covenants related to sales of assets, sale-leaseback transactions, investment transactions, and the payment of dividends and other restricted payments. If the Company draws on the Credit Facility, the Company will be required to maintain a first lien leverage ratio as defined (the “Leverage Ratio”) not more than 2.75 to 1.00. The Credit Facility also contains certain representations and warranties, other affirmative and negative covenants, and events of default customary for secured revolving credit facilities of this type.

The Company’s failure to comply with any of these covenants, including compliance with the Leverage Ratio, will be an event of default under the Credit Facility, in which case the administrative agent may, with the consent or at the request of lenders holding a majority of the commitments and outstanding loans, terminate the Credit Facility and declare all or any portion of the obligations under the Credit Facility due and payable. Other events of default under the Credit Facility include:

• the Company’s failure to pay principal on the loans when due and payable, or its failure to pay interest on the loans or to pay certain fees and expenses (subject to applicable grace periods);

• the occurrence of a change of control (as defined in the Credit Facility);

• a breach or default by the Company or its subsidiaries on the payment of principal of any other indebtedness in an aggregate amount greater than $10,000;

• breach of representations or warranties in any material respect;

• failure to perform other obligations under the Credit Facility and the security documents for the Credit Facility (subject to applicable cure periods); or

• certain bankruptcy or insolvency events.

In the event of a bankruptcy or insolvency event of default, the Credit Facility will automatically terminate, and all obligations thereunder will immediately become due and payable.

As of June 30, 2012, the Company was in compliance with all of the financial covenants in its Credit Facility.

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NOTE 4—INCOME TAXES

The Company’s effective income tax rate is based on expected income, statutory tax rates, tax planning opportunities available in the various jurisdictions in which it operates and the impact of valuation allowances against deferred tax assets. For interim financial reporting, the Company estimates the annual income tax rate based on projected taxable income for the full year and records a quarterly income tax provision or benefit in accordance with the anticipated annual rate. The Company refines the estimates of the year’s taxable income as new information becomes available, including actual year-to-date financial results. This continual estimation process often results in a change to the expected effective income tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected annual income tax rate. Significant judgment is required in determining the effective tax rate and in evaluating the tax positions.

The effective tax rate from continuing operations for the three months ended June 30, 2012 was 44.8%. The effective tax rate from continuing operations for the six months ended June 30, 2012 was 42.8%. The Company’s tax rates for the three and six months ended June 30, 2012 differ from the statutory tax rate primarily due to temporary differences between the financial reporting basis and tax basis of our assets and liabilities and the inability to recognize an associated deferred tax benefit, due to our ongoing assessment that the realization of our deferred tax assets is unlikely.

As a result of the Company’s history of operating losses, the Company’s net deferred tax assets are fully offset by a valuation allowance at June 30, 2012 and December 31, 2011.

The Company regularly assesses whether it is more likely than not that its deferred tax asset balance will be recovered from future taxable income, taking into account such factors as its earnings history, carryback and carryforward periods, and tax planning strategies. When evidence exists that indicates that recovery is uncertain, a valuation allowance is maintained against the deferred tax asset. At this time, the Company does not believe that realization of its deferred tax assets is more likely than not to occur.

The Company recognizes a tax benefit associated with an uncertain tax position when, in the Company’s judgment, it is more likely than not that the position will be sustained upon examination by a taxing authority. For a tax position that meets the more-likely-than-not recognition threshold, the Company initially and subsequently measures the tax benefit as the largest amount that the Company judges to have a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority.

As of June 30, 2012 and December 31, 2011, the amount of unrecognized tax benefits was $2,500, all of which would affect the Company’s annual effective tax rate, if recognized. This unrecognized tax benefit is associated with the Company’s non-forfeitable ownership interest in SV Holdco, LLC (see Note 9—Screenvision Exhibition, Inc.). The Company has recognized a tax basis for these units that is lower than their carrying value for financial statement purposes. However, as this tax position may not be sustained upon examination, the Company has recorded a related liability for this uncertain tax position.

NOTE 5—EQUITY BASED COMPENSATION

In March 2004, the Board of Directors adopted the Carmike Cinemas, Inc. 2004 Incentive Stock Plan (the “2004 Incentive Stock Plan”). The Company’s Compensation and Nominating Committee (or similar committee) may grant stock options, stock grants, stock units, and stock appreciation rights under the 2004 Incentive Stock Plan to certain eligible employees and to outside directors. As of June 30, 2012, there were 1,309,684 shares available for future grants under the 2004 Incentive Stock Plan. The Company’s policy is to issue new shares upon exercise of options and the issuance of stock grants.

The Company also issues restricted stock awards to certain key employees and directors. Generally, the restricted stock vests over a one to three year period and compensation expense is recognized over the one to three year period equal to the grant date fair value of the shares awarded. As of June 30, 2012, the Company also had 240,083 shares of performance-based awards outstanding which are dependent on the achievement of EBITDA targets that vest over a three-year period. As of June 30, 2012, 96,083 shares of these performance-based stock awards have been earned due to the achievement of EBITDA targets. Performance-based stock awards are recognized as compensation expense over the vesting period based on the fair value on the date of grant and the number of shares ultimately expected to vest. The Company has determined the achievement of the performance target for the unearned awards is probable.

The Company’s total stock-based compensation expense was approximately $638 and $724 for the three months ended June 30, 2012 and 2011, respectively, and $1,101 and $1,188 for the six months ended June 30, 2012 and 2011, respectively. Included in stock-based compensation expense for the three and six months ended June 30, 2012, is $115 related to the accelerated vesting of stock-based awards to the Company’s former Vice President-General Manager Theatre Operations. Included in stock-based compensation expense for the three and six months ended June 30, 2011, is $222 related to the accelerated vesting of stock-based awards to the Company’s former Senior Vice President-General Counsel and Secretary. Stock-based compensation expense is included in general and administrative expenses in the consolidated statement of operations with the exception of the accelerated vested awards which are included in Severance Agreement Charges. As of June 30, 2012, the Company had approximately $4,070 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Company’s plans. This cost is expected to be recognized as stock-based compensation expense over a weighted-average period of approximately 2.2 years. This expected cost does not include the impact of any future stock-based compensation awards.

10

Options – Service Condition Vesting

The Company currently uses the Black-Scholes option pricing model to determine the fair value of its stock options for which vesting is dependent only on employees providing future service.

No options were granted during the first six months of 2012. The following table sets forth information about the weighted-average fair value of options granted and the weighted-average assumptions for such options granted during the first six months of 2011:

	2011
Fair value of options on grant date	$	4.94
Expected life (years)		6.0
Risk-free interest rate		2.3	%
Expected dividend yield		—	%
Expected volatility		76.2	%

The Company’s stock-based compensation expense is recorded based on an estimated forfeiture rate of 5%.

The following table sets forth the summary of option activity for stock options with service vesting conditions as of June 30, 2012:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Yrs.)		Aggregate Intrinsic Value
Outstanding at January 1, 2012		796,500		$	12.20		6.93
Granted		—		$	—
Exercised		(34,000	)	$	8.69			$	198
Forfeited		—		$	—
Outstanding at June 30, 2012		762,500		$	12.35		6.31	$	3,522
Exercisable on June 30, 2012		569,161		$	13.74		5.69	$	2,547
Expected to vest June 30, 2012		183,672		$	8.28		8.14	$	975

Restricted Stock

The following table sets forth the summary of activity for restricted stock grants, including performance-based awards, for the six months ended June 30, 2012:

	Shares			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2012		248,804		$	8.43
Granted		263,928		$	12.13
Vested		(65,808	)	$	7.92
Forfeited		(6,000	)	$	10.91
Nonvested at June 30, 2012		440,924		$	10.69

11

NOTE 6—DISCONTINUED OPERATIONS

Theatres are generally considered for closure due to an expiring lease, underperformance, or the opportunity to better deploy invested capital. During the three months ended June 30, 2012 and 2011, the Company closed three theatres and one theatre, respectively, and for the six months ended June 30, 2012 and 2011, the Company closed seven and four theatres, respectively. With respect to the closures during the three months ended June 30, 2012 and 2011, the Company classified one theatre in each period as discontinued operations and for the six months ended June 30, 2012 and 2011, the Company classified four theatres in each period as discontinued operations. The Company reported the results of these operations, including gains and losses on disposal, as discontinued operations. The operations and cash flows of these theatres have been eliminated from the Company’s operations, and the Company will not have any continuing involvement in their operations.

All activity during the three and six months ended June 30, 2012 included in the accompanying consolidated statements of operations has been reclassified to separately reflect the results of operations from theatres closed in 2012 and considered discontinued operations through the respective date of the theatre closings. Assets and liabilities associated with the discontinued operations have not been segregated from assets and liabilities from continuing operations as they are not material.

The following table sets forth the summary of activity for discontinued operations for the three and six months ended June 30, 2012 and 2011:

	Three Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	42		$	714
Operating loss before income taxes	$	(59	)	$	(91	)
Income tax benefit from discontinued operations		22			31
Gain on disposal, before income taxes		167			9
Income tax expense on disposal		(62	)		(3	)
Income (loss) from discontinued operations	$	68		$	(54	)
	Six Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	242		$	1,336
Operating loss before income taxes	$	(160	)	$	(385	)
Income tax benefit from discontinued operations		60			131
Gain on disposal, before income taxes		125			235
Income tax expense on disposal		(46	)		(80	)
Loss from discontinued operations	$	(21	)	$	(99	)

NOTE 7—COMMITMENTS AND CONTINGENCIES

Commitments

As of June 30, 2012, the Company had non-cancelable purchase commitments related to capital expenditures totaling $8,100.

Contingencies

The Company, in the normal course of business, is involved in routine litigation and legal proceedings, such as personal injury claims, employment matters, contractual disputes and claims alleging Americans with Disabilities Act violations. Currently, there is no pending litigation or proceedings that the Company believes will have a material adverse effect, either individually or in the aggregate, on its business or its financial position, results of operations or cash flow.

NOTE 8—NET INCOME (LOSS) PER SHARE

Basic net income (loss) per common share has been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted income (loss) per share is computed using the weighted-average number of common shares and common stock equivalents outstanding. Common stock equivalents totaling 400,337 and 1,004,577, for the three months ended June 30, 2012 and 2011, respectively, and common stock equivalents totaling 253,599 for the six months ended June 30, 2012 were excluded from the calculation of diluted earnings per share because of a decline in the average market price of the common stock below the exercise price. As a result of the Company’s net losses, all common stock equivalents aggregating 1,180,908 for the six months ended June 30, 2011 were excluded from the calculation of diluted loss per share given their anti-dilutive effect.

12

NOTE 9—SCREENVISION EXHIBITION, INC.

On October 14, 2010, the Company finalized the modification of its long-term exhibition agreement (the “Modified Exhibition Agreement”) with Screenvision Exhibition, Inc. (“Screenvision”), the Company’s exclusive provider of on-screen advertising services. The Modified Exhibition Agreement extends the Company’s exhibition agreement with Screenvision, which was set to expire on July 1, 2012, for an additional 30 year term through July 1, 2042 (“Expiration Date”).

In connection with the Modified Exhibition Agreement, the Company received a cash payment of $30,000 from Screenvision in January 2011. In addition, on October 14, 2010, the Company received, for no additional consideration, Class C membership units representing, as of that date, approximately 20% of the issued and outstanding membership units of SV Holdco, LLC (“SV Holdco”). SV Holdco is a holding company that owns and operates the Screenvision business through a subsidiary entity. SV Holdco has elected to be taxed as a partnership for U.S. federal income tax purposes.

In September 2011, the Company made a voluntary capital contribution of $718 to SV Holdco. The capital contribution was made to maintain the Company’s relative ownership interest following an acquisition by Screenvision and additional capital contributions by other owners of SV Holdco. The Company received Class A membership units representing less than 1% of the issued and outstanding membership units of SV Holdco in return for the Company’s capital contribution.

As of June 30, 2012, the Company held Class C and Class A membership units representing approximately 19% of the total issued and outstanding membership units of SV Holdco. As of June 30, 2012, the carrying value of the Company’s ownership interest in SV Holdco is $5,546 and is included in investments in unconsolidated affiliates in the consolidated balance sheets and, for book purposes, is accounted for as an equity method investment.

The Company’s Class C membership units are intended to be treated as a “profits interest” in SV Holdco for U.S. federal income tax purposes and thus do not give the Company an interest in the other members’ initial or subsequent capital contributions. As a profits interest, the Company’s Class C membership units are designed to represent an equity interest in SV Holdco’s future profits and appreciation in assets beyond a defined threshold amount, which equaled $85,000 as of October 14, 2010. The $85,000 threshold amount represented the agreed upon value of initial capital contributions made by the members to SV Holdco and is subject to adjustment to account for future capital contributions made to SV Holdco. Accordingly, the threshold amount applicable to the Company’s Class C membership units has increased to $88,000 as of June 30, 2012.

The Company will also receive additional Class C membership units (“bonus units”), all of which will be subject to forfeiture, or may forfeit some of its initial Class C membership units, based upon changes in the Company’s future theatre and screen count. However, the Company will not forfeit more than 25% of the Class C membership units it received in October 2010, and the Company will not receive bonus units in excess of 33% of the Class C membership units it received in October 2010. Any bonus units and the initial Class C membership units subject to forfeiture will each become non-forfeitable on the Expiration Date, or upon the earlier occurrence of certain events, including (1) a change of control or liquidation of SV Holdco or (2) the consummation of an initial public offering of securities of SV Holdco. As a result, bonus units and forfeitable units will not be reflected in the Company’s consolidated financial statements until such units become non-forfeitable. The non-forfeitable ownership interest in SV Holdco was recorded at an estimated fair value of $6,555 which was determined using the Black Scholes Model. The Company has applied the equity method of accounting for the non-forfeitable units and for financial reporting purposes began recording the related percentage of the earnings or losses of SV Holdco in its consolidated statement of operations since October 14, 2010. The Company’s non-forfeitable Class C and Class A membership units represented approximately 15% of the total issued and outstanding membership units of SV Holdco as of June 30, 2012.

For financial reporting purposes, the gains from both the $30,000 cash payment to the Company and its non-forfeitable membership units in SV Holdco ($36,555 in the aggregate) have been deferred and will be recognized as concessions and other revenue on a straight line basis over the remaining term of the Modified Exhibition Agreement. The Company has included in concessions and other revenue in the consolidated statement of operations amounts related to Screenvision of approximately $2,100 and $4,400 for the three and six months ended June 30, 2012 and approximately $2,500 and $4,300 for the three and six months ended June 30, 2011, respectively. The Company reclassifies certain amounts from Screenvision included in concessions and other revenue to earnings from unconsolidated affiliates. The amount reclassified is based on the Company’s non-forfeitable ownership percentage of SV Holdco membership units, represents an intercompany gain to the Company and totaled approximately $400 for the three months ended June 30, 2012 and 2011 and approximately $800, for the six months ended June 30, 2012 and 2011. The Company has included in accounts receivable in the consolidated balance sheets amounts due from Screenvision of $1,874 and $1,860 at June 30, 2012 and December 31, 2011, respectively.

13

NOTE 10—INVESTMENTS IN UNCONSOLIDATED AFFILIATES

Our investments in affiliated companies accounted for by the equity method consist of our ownership interest in Screenvision, as discussed in Note 9 – Screenvision Exhibition, Inc., and interests in other joint ventures.

Combined financial information of the unconsolidated affiliated companies accounted for by the equity method is as follows:

	As of June 30,
	2012
Assets:
Current assets	$	40,349
Noncurrent assets		163,743
Total assets	$	204,092
Liabilties:
Current liabilities	$	40,792
Noncurrent liabilities		86,424
Total liabilities	$	127,216

	Three Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	31,403		$	45,934
Net loss	$	(5,328	)	$	6
	Six Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	54,187		$	68,942
Net loss	$	(13,697	)	$	(7,735	)

NOTE 11—THEATRE ACQUISITIONS

On March 30, 2012, the Company completed its purchase of certain assets from Destinta Theatres for approximately $700. The acquisition consisted of a seven screen theatre in Clarion, Pennsylvania. The Company has accounted for this transaction as an asset acquisition. The purchase price was allocated to the assets acquired, primarily leasehold improvements, based on their respective fair values.

NOTE 12—COMMON STOCK OFFERING

On April 11, 2012, the Company issued 4.0 million shares of its common stock, at a price to the public of $13.00 per share through a registered public offering. The Company granted the underwriters an option to purchase up to an additional 600 thousand shares of the Company’s common stock to cover over-allotments, if any, which the underwriters could exercise within 30 days of the date of the final prospectus. The underwriters purchased the additional 600 thousand shares of common stock on April 11, 2012. The offering was made pursuant to the Company’s effective shelf registration statement previously filed with the Securities and Exchange Commission (“SEC”). The net proceeds from the transaction were approximately $56,300. The funds received from the issuance of the shares will be used for general corporate purposes, including working capital, repayment of debt, possible acquisitions and other capital expenditures.

NOTE 13—GUARANTOR SUBSIDIARIES

The Company’s Senior Secured Notes, the offering of which was registered under the Securities Act of 1933, as amended, are fully and unconditionally guaranteed, on a joint and several basis, by the following 100% directly or indirectly owned subsidiaries: Eastwynn Theatres, Inc., George G. Kerasotes Corporation, GKC Indiana Theatres, Inc., GKC Michigan Theatres, Inc., GKC Theatres, Inc., and Military Services, Inc. Therefore, the Company is providing the following condensed consolidating financial statement information as of June 30, 2012 and December 31, 2011 and for the three and six months ended June 30, 2012 and 2011 in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered:

14

CONDENSED CONSOLIDATING BALANCE SHEET

	As of June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	72,966		$	12,813		$	—		$	85,779
Restricted cash		17			—			—			17
Accounts receivable		4,855			804			—			5,659
Inventories		719			2,226			—			2,945
Prepaid expenses and other assets		4,375			4,619			—			8,994
Total current assets		82,932			20,462			—			103,394
Property and equipment:
Land		12,716			40,979			—			53,695
Buildings and building improvements		46,923			226,225			—			273,148
Leasehold improvements		19,625			101,982			—			121,607
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,972			155,692			—			214,664
Construction in progress		1,535			2,000			—			3,535
Total property and equipment		148,446			563,173			—			711,619
Accumulated depreciation and amortization		(79,054	)		(285,005	)		—			(364,059	)
Property and equipment, net of accumulated depreciation		69,392			278,168			—			347,560
Intercompany receivables		104,155			—			(104,155	)		—
Investments in subsidiaries		90,268			—			(90,268	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,115			—			1,115
Investments in unconsolidated affiliates		5,546			957			—			6,503
Other assets		15,639			6,185			—			21,824
Total assets	$	367,932		$	314,974		$	(194,423	)	$	488,483
Liabilities and stockholders’ equity:
Current liabilities:
Accounts payable	$	19,784			2,865			—			22,649
Accrued expenses		14,837			18,344			—			33,181
Current maturities of long-term debt, capital leases and long-term financing obligations		398			1,724			—			2,122
Total current liabilities		35,019			22,933			—			57,952
Long-term liabilities:
Long-term debt, less current maturities		209,512			—			—			209,512
Capital leases and long-term financing obligations, less current maturities		28,058			85,662			—			113,720
Intercompany liabilities		—			104,155			(104,155	)		—
Deferred revenue		33,567			—			—			33,567
Other		5,295			11,956			—			17,251
Total long-term liabilities		276,432			201,773			(104,155	)		374,050
Stockholders’ equity:
Preferred stock		—			—			—			—
Common stock		539			1			(1	)		539
Treasury stock		(11,740	)		—			—			(11,740	)
Paid-in capital		348,593			237,800			(237,800	)		348,593
Accumulated deficit		(280,911	)		(147,533	)		147,533			(280,911	)
Total stockholders’ equity		56,481			90,268			(90,268	)		56,481
Total liabilities and stockholders’ equity	$	367,932		$	314,974		$	(194,423	)	$	488,483

15

CONDENSED CONSOLIDATING BALANCE SHEET

	As of December 31, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	3,623		$	9,993		$	—		$	13,616
Restricted cash		331			—			—			331
Accounts receivable		4,654			331			—			4,985
Inventories		722			2,233			—			2,955
Prepaid expenses and other assets		4,953			4,457			—			9,410
Total current assets		14,283			17,014			—			31,297
Property and equipment:
Land		12,716			41,193			—			53,909
Buildings and building improvements		46,676			229,545			—			276,221
Leasehold improvements		19,307			104,240			—			123,547
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,128			154,329			—			212,457
Construction in progress		159			2,190			—			2,349
Total property and equipment		145,661			567,792			—			713,453
Accumulated depreciation and amortization		(75,760	)		(281,758	)		—			(357,518	)
Property and equipment, net of accumulated depreciation		69,901			286,034			—			355,935
Intercompany receivables		123,071			—			(123,071	)		—
Investment in subsidiaries		82,985			—			(82,985	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,169			—			1,169
Investment in unconsolidated affiliates		8,498			—			—			8,498
Other		10,536			7,334			—			17,870
Total assets	$	309,274		$	319,638		$	(206,056	)	$	422,856
Liabilities and stockholders’ (deficit) equity:
Current liabilities:
Accounts payable	$	27,598		$	1,985		$	—		$	29,583
Accrued expenses		19,752			11,384			—			31,136
Current maturities of long-term debt, capital leases and long-term financing obligations		2,391			1,568			—			3,959
Total current liabilities		49,741			14,937			—			64,678
Long-term liabilities:
Long-term debt, less current maturities		196,880			—			—			196,880
Capital leases and long-term financing obligations, less current maturities		28,223			86,385			—			114,608
Intercompany liabilities		—			123,071			(123,071	)		—
Deferred revenue		34,009			—			—			34,009
Other		6,045			12,261			—			18,306
Total long-term liabilities		265,157			221,717			(123,071	)		363,803
Stockholders’ (deficit) equity:
Preferred Stock		—			—			—			—
Common Stock		401			1			(1	)		401
Treasury stock		(11,683	)		—			—			(11,683	)
Paid-in capital		290,997			237,800			(237,800	)		290,997
Accumulated deficit		(285,340	)		(154,816	)		154,816			(285,340	)
Total stockholders’ (deficit) equity		(5,625	)		82,985			(82,985	)		(5,625	)
Total liabilities and stockholders’ (deficit) equity	$	309,274		$	319,638		$	(206,056	)	$	422,856

16

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	14,254		$	72,682	$	—		$	86,936
Concessions and other		14,982			40,980		(6,607	)		49,355
Total operating revenues		29,236			113,662		(6,607	)		136,291
Operating costs and expenses:
Film exhibition costs		8,006			40,527		—			48,533
Concession costs		999			4,511		—			5,510
Other theatre operating costs		10,337			48,977		(6,607	)		52,707
General and administrative expenses		4,588			586		—			5,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		1,716			6,040		—			7,756
Impairment of long-lived assets		4			46		—			50
Total operating costs and expenses		26,143			100,687		(6,607	)		120,223
Operating income		3,093			12,975		—			16,068
Interest expense		2,363			6,248		—			8,611
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(3,912	)		—		3,912			—
(Loss) income before income tax and (loss) income from unconsolidated affiliates		(319	)		6,727		(3,912	)		2,496
Income tax (benefit) expense		(2,034	)		2,952		—			918
(Loss) income from unconsolidated affiliates		(518	)		70		—			(448	)
Income from continuing operations		1,197			3,845		(3,912	)		1,130
Income from discontinued operations		1			67		—			68
Net income	$	1,198		$	3,912	$	(3,912	)	$	1,198

17

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	14,131		$	70,549		$	—		$	84,680
Concessions and other		14,623			38,534			(6,363	)		46,794
Total operating revenues		28,754			109,083			(6,363	)		131,474
Operating costs and expenses:
Film exhibition costs		7,836			38,787			—			46,623
Concession costs		972			4,357			—			5,329
Other theatre operating costs		10,382			45,429			(6,363	)		49,448
General and administrative expenses		3,984			512			—			4,496
Severance agreement charges		845			—			—			845
Depreciation and amortization		1,691			6,183			—			7,874
Loss on sale of property and equipment		67			13			—			80
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		786			378			—			1,164
Total operating costs and expenses		27,313			95,659			(6,363	)		116,609
Operating income		1,441			13,424			—			14,865
Interest expense		2,738			5,893			—			8,631
Equity in earnings of subsidiaries		(7,493	)		—			7,493			—
Income before income tax and income from unconsolidated affiliates		6,196			7,531			(7,493	)		6,234
Income tax expense		794			—			—			794
Income from unconsolidated affiliates		405			92			—			497
Income from continuing operations		5,807			7,623			(7,493	)		5,937
Income (loss) from discontinued operations		76			(130	)		—			(54	)
Net income	$	5,883		$	7,493		$	(7,493	)	$	5,883

18

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	28,029		$	142,097	$	—		$	170,126
Concessions and other		29,804			79,988		(12,920	)		96,872
Total operating revenues		57,833			222,085		(12,920	)		266,998
Operating costs and expenses:
Film exhibition costs		15,238			76,802		—			92,040
Concession costs		2,014			9,088		—			11,102
Other theatre operating costs		21,530			96,644		(12,920	)		105,254
General and administrative expenses		9,016			1,158		—			10,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		3,425			12,117		—			15,542
Loss on sale of property and equipment		20			228		—			248
Impairment of long-lived assets		13			1,523		—			1,536
Total operating costs and expenses		51,749			197,560		(12,920	)		236,389
Operating income		6,084			24,525		—			30,609
Interest expense		4,882			11,992		—			16,874
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(7,306	)		—		7,306			—
Income before income tax and (loss) income from unconsolidated affiliates		3,547			12,533		(7,306	)		8,774
Income tax (benefit) expense		(2,109	)		5,441		—			3,332
(Loss) income from unconsolidated affiliates		(1,172	)		180		—			(992	)
Income from continuing operations		4,484			7,272		(7,306	)		4,450
(Loss) income from discontinued operations		(55	)		34		—			(21	)
Net income	$	4,429		$	7,306	$	(7,306	)	$	4,429

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CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	25,124		$	120,596		$	—		$	145,720
Concessions and other		26,298			66,434			(11,265	)		81,467
Total operating revenues		51,422			187,030			(11,265	)		227,187
Operating costs and expenses:
Film exhibition costs		13,656			65,043			—			78,699
Concession costs		1,716			7,479			—			9,195
Other theatre operating costs		20,408			89,318			(11,265	)		98,461
General and administrative expenses		8,169			1,060			—			9,229
Severance agreement charges		845			—			—			845
Depreciation and amortization		3,294			12,368			—			15,662
Loss (gain) on sale of property and equipment		67			(7	)		—			60
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		908			417			—			1,325
Total operating costs and expenses		49,813			175,678			(11,265	)		214,226
Operating income		1,609			11,352			—			12,961
Interest expense		5,976			11,808			—			17,784
Equity in loss of subsidiaries		519			—			(519	)		—
Loss before income tax and (loss) income from unconsolidated affiliates		(4,886	)		(456	)		519			(4,823	)
Income tax expense		7,289			—			—			7,289
(Loss) income from unconsolidated affiliates		(445	)		141			—			(304	)
Loss from continuing operations		(12,620	)		(315	)		519			(12,416	)
Income (loss) from discontinued operations		105			(204	)		—			(99	)
Net loss	$	(12,515	)	$	(519	)	$	519		$	(12,515	)

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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash (used in) provided by operating activities		(2,151	)		28,280			—		26,129
Cash flows from investing activities:
Purchases of property and equipment		(4,855	)		(5,771	)		—		(10,626	)
Purchase acquistion		—			(702	)		—		(702	)
Proceeds from sale of property and equipment		33			667			—		700
Other investing activities		314			—			—		314
Net cash used in investing activities		(4,508	)		(5,806	)		—		(10,314	)
Cash flows from financing activities:
Short-term borrowings		5,000			—			—		5,000
Repayments of short term borrowings		(5,000	)		—			—		(5,000	)
Issuance of long-term debt		209,500			—			—		209,500
Repayments of long-term debt		(200,229	)		—			—		(200,229	)
Debt issuance costs		(8,599	)		—			—		(8,599	)
Repayments of capital leases and long-term financing obligations		(162	)		(738	)		—		(900	)
Issuance of common stock		56,633			—			—		56,633
Purchase of treasury stock		(57	)		—			—		(57	)
Intercompany receivable/payable		18,916			(18,916	)		—		—
Net cash provided by (used in) financing activities		76,002			(19,654	)		—		56,348
Increase in cash and cash equivalents		69,343			2,820			—		72,163
Cash and cash equivalents at beginning of period		3,623			9,993			—		13,616
Cash and cash equivalents at end of period		72,966			12,813			—		85,779

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CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2011
	Carmike Cinemas, Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	24,870		$	16,534		$	—	$	41,404
Cash flows from investing activities:
Purchases of property and equipment		(2,293	)		(3,955	)		—		(6,248	)
Proceeds from sale of property and equipment		6			438			—		444
Other investing activities		279			—			—		279
Net cash used in investing activities		(2,008	)		(3,517	)				(5,525	)
Cash flows from financing activities:
Repayments of long-term debt		(26,279	)		(844	)		—		(27,123	)
Intercompany receivable/payable		13,711			(13,711	)		—		—
Other financing activities		(588	)		—			—		(588	)
Net cash used in financing activities		(13,156	)		(14,555	)		—		(27,711	)
Increase / (decrease) in cash and cash equivalents		9,706			(1,538	)		—		8,168
Cash and cash equivalents at beginning of period		3,418			9,648			—		13,066
Cash and cash equivalents at end of period	$	13,124		$	8,110		$	—	$	21,234

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The Company

We are one of the largest motion picture exhibitors in the United States and as of June 30, 2012 we owned, operated or had an interest in 233 theatres with 2,245 screens located in 35 states. We target small to mid-size non-urban markets with the belief that they provide a number of operating benefits, including lower operating costs and fewer alternative forms of entertainment.

As of June 30, 2012, we had 217 theatres with 2,122 screens on a digital-based platform, including 209 theatres with 750 screens equipped for 3-D. We believe our leading-edge technologies allow us not only greater flexibility in showing feature films, but also provide us with the capability to explore revenue-enhancing alternative content programming. Digital film content can be easily moved to and from auditoriums in our theatres to maximize attendance. The superior quality of digital cinema and our 3-D capability allows us to provide a quality presentation to our patrons.

We generate revenue primarily from box office receipts and concession sales along with additional revenues from screen advertising sales, our two Hollywood Connection fun centers, video games located in some of our theatres, and theatre rentals. Our revenue depends to a substantial degree on the availability of suitable motion pictures for screening in our theatres and the appeal of such motion pictures to patrons in our specific theatre markets. A disruption in the production of motion pictures, a lack of motion pictures, or the failure of motion pictures to attract the patrons in our theatre markets will likely adversely affect our business and results of operations.

Our revenue also varies significantly depending upon the timing of the film releases by distributors. While motion picture distributors now release major motion pictures more evenly throughout the year, the most marketable films are usually released during the summer months and the year-end holiday season, and we usually earn more during those periods than in other periods during the year. As a result, the timing of such releases affects our results of operations, which may vary significantly from quarter to quarter and year to year.

We generate the majority of our box office revenue from a particular film within the first 30 days of its release date to theater exhibitors. Historically, films have not been released in other formats, such as DVD or video-on-demand, until approximately 120 days after the film’s initial release. However, over the past several years, the release window for films in other formats has shortened. It is possible that these release windows will continue to shorten, which could impact our ability to attract patrons to our theatres.

Film rental costs are variable in nature and fluctuate with the prospects of a film and the box office revenues of a film. Film rental rates are generally negotiated on a film-by-film and theatre-by-theatre basis and are typically higher for blockbuster films. Advertising costs, which are expensed as incurred, primarily represent advertisements and movie listings placed in newspapers. The cost of these advertisements is based on, among other things, the size of the advertisement and the circulation of the newspaper.

Concessions costs fluctuate with our concession revenues. We purchase substantially all of our non-beverage concession supplies from one supplier and substantially all of our beverage supplies from one supplier.

Other theatre costs consist primarily of theatre labor and occupancy costs. Theatre labor includes a fixed cost component that represents the minimum staffing needed to operate a theatre and a variable component that fluctuates in relation to revenues as theatre staffing is adjusted to address changes in attendance. Facility lease expense is primarily a fixed cost as most of our leases require a fixed monthly rent payment. Certain of our leases are subject to percentage rent clauses that require payments of amounts based on the level of revenue achieved at the theatre-level. Other occupancy costs are substantially fixed.

The ultimate performance of our film product any time during the calendar year will have a dramatic impact on our operating results and cash needs. In addition, the seasonal nature of the exhibition industry and positioning of film product makes our need for cash vary significantly from quarter to quarter. Generally, our liquidity needs are funded by operating cash flow, available funds under our credit agreement and short term float. Our ability to generate this cash will depend largely on future operations.

We continue to focus on operating performance improvements. This includes managing our operating costs, implementing pricing initiatives and closing underperforming theatres. We also intend to allocate our available capital primarily to developing new build-to-suit theatres, making strategic acquisitions, installing Big D auditoriums and improving the condition of our theatres.

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We actively seek ways to grow our circuit through the building of new theatres and acquisitions. On March 30, 2012, we finalized our purchase of certain assets from Destinta Theatres for approximately $0.7 million. The acquisition consisted of a seven screen theatre in Clarion, Pennsylvania.

In addition, we continue to pursue opportunities for organic growth through new theatre development. We opened two new build-to-suit theatres during the first six months of 2012 and plan to open additional theatres in 2012.

For a summary of risks and uncertainties relevant to our business, please see “Item 1A. Risk Factors” contained in our Annual Report on Form 10-K for the year ended December 31, 2011.

Results of Operations

Comparison of Three and Six Months Ended June 30, 2012 and June 30, 2011

Revenues. We collect substantially all of our revenues from the sale of admission tickets and concessions. The table below provides a comparative summary of the operating data for this revenue generation.

	Three Months Ended June 30,				Six Months Ended June 30,
	2012		2011		2012		2011
Average theatres		234		235		235		236
Average screens		2,253		2,215		2,256		2,223
Average attendance per screen (1)		5,583		5,890		10,975		10,096
Average admission per patron (1)	$	6.91	$	6.52	$	6.88	$	6.52
Average concessions and other sales per patron (1)	$	3.92	$	3.61	$	3.92	$	3.66
Total attendance (in thousands) (1)		12,580		13,045		24,764		22,444
Total operating revenues (in thousands)	$	136,291	$	131,474	$	266,998	$	227,187

(1) Includes activity from theatres designated as discontinued operations and reported as such in the consolidated statements of operations.

Total revenue increased approximately 3.7% to $136.3 million for the three months ended June 30, 2012 compared to $131.5 million for the three months ended June 30, 2011, due to an increase in average admissions per patron from $6.52 in the second quarter of 2011 to $6.91 in the second quarter of 2012 and an increase in average concessions and other sales per patron from $3.61 in the second quarter of 2011 to $3.92 for the second quarter of 2012, partially offset by a decrease in total attendance from 13.0 million in the second quarter of 2011 to 12.6 million for the second quarter of 2012. Attendance was down period over period due principally to a more favorable movie slate in 2011. Average admissions per patron increased primarily due to price increases and greater attendance at premium 3-D shows compared to 2-D shows. Average concessions and other sales per patron increased, primarily due to concession promotions and increased prices.

Total revenue increased approximately 17.5% to $267.0 million for the six months ended June 30, 2012 from $227.2 million for the six months ended June 30, 2011 due to an increase in total attendance from 22.4 million for the 2011 period to 24.8 million for the 2012 period, an increase in average admissions per patron from $6.52 for the 2011 period to $6.88 in the 2012 period and an increase in average concessions and other sales per patron from $3.66 in the 2011 period to $3.92 in the 2012 period.

Admissions revenue increased approximately 2.7% to $86.9 million for the three months ended June 30, 2012 from $84.7 million for the same period in 2011, due to an increase in average admissions per patron from $6.52 in the second quarter of 2011 to $6.91 for the second quarter of 2012, partially offset by a decrease in total attendance from 13.0 million in the second quarter of 2011 to 12.6 million for the second quarter of 2012.

Admissions revenue increased approximately 16.7% to $170.1 million for the six months ended June 30, 2012 from $145.7 million for the same period in 2011, due to an increase in total attendance from 22.4 million for the six months ended June 30, 2011 to 24.8 million for the six months ended June 30, 2012 and an increase in average admissions per patron from $6.52 for the 2011 period to $6.88 for the 2012 period.

Concessions and other revenue increased approximately 5.5% to $49.4 million for the three months ended June 30, 2012 compared to $46.8 million for the same period in 2011, due to an increase average concessions and other sales per patron from $3.61 in the second quarter of 2011 to $3.92 for the second quarter of 2012, partially offset by a decrease in total attendance from 13.0 million for the three months ended June 30, 2011 to 12.6 million for the six months ended June 30, 2012.

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Concessions and other revenue increased approximately 18.9% to $96.9 million for the six months ended June 30, 2012 compared to $81.5 million for the six months ended June 30, 2011 due to an increase in total attendance from 22.4 million for the six months ended June 30, 2011 to 24.8 million for the six months ended June 30, 2012 and an increase in average concession and other sales per patron from $3.66 in the 2011 period to $3.92 for the 2012 period.

We operated 233 theatres with 2,245 screens at June 30, 2012 compared to 235 theatres with 2,215 screens at June 30, 2011.

Operating costs and expenses. The table below summarizes operating expense data for the periods presented.

	Three Months Ended June 30,							Six Months Ended June 30,
($’s in thousands)	2012		2011		% Change			2012		2011		% Change
Film exhibition costs	$	48,533	$	46,623		4		$	92,040	$	78,699		17
Concession costs	$	5,510	$	5,329		3		$	11,102	$	9,195		21
Other theatre operating costs	$	52,707	$	49,448		7		$	105,254	$	98,461		7
General and administrative expenses	$	5,174	$	4,496		15		$	10,174	$	9,229		10
Severance agreement charges	$	493	$	845		(42	)	$	493	$	845		(42	)
Depreciation and amortization	$	7,756	$	7,874		—		$	15,542	$	15,662		—
Loss on sale of property and equipment	$	—	$	80		n/m		$	248	$	60		n/m
Write-off of note receivable	$	—	$	750		n/m		$	—	$	750		n/m
Impairment of long-lived assets	$	50	$	1,164		n/m		$	1,536	$	1,325		n/m

Film exhibition costs. Film exhibition costs fluctuate in direct relation to the increases and decreases in admissions revenue and the mix of aggregate and term film deals. Film exhibition costs as a percentage of revenues are generally higher for periods with more blockbuster films. Film exhibition costs for the three months ended June 30, 2012 increased to $48.5 million as compared to $46.6 million for the three months ended June 30, 2011 primarily resulting from increased average admissions per patron. As a percentage of admissions revenue, film exhibition costs increased to 55.8% for the three months ended June 30, 2012 as compared to 55.1% for the three months ended June 30, 2011. Film exhibition costs for the six months ended June 30, 2012 increased to $92.0 million as compared to $78.7 million for the six months ended June 30, 2011. As a percentage of admissions revenue, film exhibition costs for the six months ended June 30, 2012 were 54.1% as compared to 54.0% for the six months ended June 30, 2011.

Concession costs. Concession costs fluctuate with changes in concessions revenue and product sales mix and changes in our cost of goods sold. Concession costs for the three months ended June 30, 2012 remained consistent with the three months ended June 30, 2011. Concession costs were $5.5 million and $5.3 million for the three months ended June 30, 2012 and 2011, respectively. As a percentage of concessions and other revenues, concession costs for the three months ended June 30, 2012 were 11.2% as compared to 11.4% for the three months ended June 30, 2011. Concession costs increased to approximately $11.1 million for the six months ended June 30, 2012, compared to $9.2 million for the six months ended June 30, 2011 due to increased concessions sales resulting from increased attendance during the six months ended June 30, 2012. As a percentage of concessions and other revenues, concession costs were 11.5% and 11.3% for the six months ended June 30, 2012 and 2011, respectively.

Other theatre operating costs. Other theatre operating costs for the three months ended June 30, 2012 increased to $52.7 million as compared to $49.4 million for the three months ended June 30, 2011. The increase in our other theatre operating costs was primarily the result of increases in salaries and wages expense, theatre occupancy costs and repair and maintenance costs. Other theatre operating costs for the six months ended June 30, 2012 increased to $105.3 million as compared to $98.5 million for the six months ended June 30, 2011. The increase in other theatre operating costs was primarily the result of increases in salaries and wages expense, theatre occupancy costs and credit card fees.

General and administrative expenses. General and administrative expenses increased to $5.2 million for the three months ended June 30, 2012 compared to $4.5 million for the three months ended June 30, 2011. General and administrative expenses for the six months ended June 30, 2012 increased to $10.2 million as compared to $9.2 million for the six months ended June 30, 2011. The increase in general and administrative expenses during the three and six months ended June 30, 2012 was primarily the result increases in salaries and wages expense, professional fees and travel expenses.

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Depreciation and amortization. Depreciation and amortization expenses remained consistent for the three and six months ended June 30, 2012 as compared to the three and six months ended June 30, 2011. Depreciation and amortization expenses were $7.8 and $7.9 million for the three months ended June 30, 2012 and 2011, respectively, and $15.5 million and $15.7 million for the six months ended June 30, 2012 and 2011, respectively.

Net gain (loss) on sales of property and equipment. We did not recognize a gain or loss on the sale of property and equipment for the three months ended June 30, 2012. We recognized a loss of $80,000 on the sale of property and equipment for the three months ended June 30, 2011. We recognized a loss of $0.2 million and $60,000 on the sale of property and equipment for the six months ended June 30, 2012 and 2011, respectively.

Write-off of note receivable. We did not write-off any note receivable for the three and six months ended June 30, 2012. For the three and six months ended June 30, 2011, we wrote off a note receivable of $750,000. The loss was the result of an uncollectible note receivable on a theatre sold in August 2008.

Impairment of long-lived assets. Impairment of long-lived assets for the three months ended June 30, 2012 decreased to $50,000 from $1.2 million for the three months ended June 30, 2011. The impairment charges for the three months ended June 30, 2012 were primarily the result of continued deterioration in previously impaired theatres. Impairment of long-lived assets for the six months ended June 30, 2012 increased to $1.5 million from $1.3 million in the 2011 period. The impairment charges for the six months ended June 30, 2012 were primarily the result of our decision to replace an existing theatre prior to the end of its useful life.

Operating income (loss). Operating income for the three months ended June 30, 2012 increased to $16.1 million from $14.9 million for the three months ended June 30, 2011. As a percentage of revenues, operating income for the three months ended June 30, 2012 was 11.8% as compared to 11.3% for the three months ended June 30, 2011. This fluctuation is primarily a result of an increase in total revenue resulting from increased average admissions revenue per patron and average concessions and other sales per patron, a reduction in impairment charges and the factors described above. Operating income for the six months ended June 30, 2012 increased 136.2% to $30.6 million as compared to $13.0 million for the six months ended June 30, 2011. As a percentage of revenues, operating income for the six months ended June 30, 2012 was 11.5% as compared to 5.7% for the six months ended June 30, 2011. These fluctuations are primarily a result of the factors described above.

Interest expense, net. Interest expense, net for the three months ended June 30, 2012 and 2011 was $8.6 million. Interest expense remained consistent for the three months ended June 30, 2012 and 2011 due to a reduction in average debt outstanding during the three months ended June 30, 2012, offset by an increase in the weighted average interest rate of our senior secured notes compared to our term loan. Interest expense, net for the six months ended June 30, 2012 decreased to $16.9 million from $17.8 million for the six months ended June 30, 2011. The decrease for the six months ended June 30, 2012 was primarily related to a decrease in the average debt outstanding.

Income tax. During the three and six months ended June 30, 2012, we recorded income tax expense of $0.9 million and $3.3 million, respectively as compared to $0.8 million and $7.3 million during the three and six months ended June 30, 2011. Income tax expense was higher for the six months ended June 30, 2011 primarily due to the current tax expense associated with the $30 million Screenvision payment received in January 2011 (as discussed in Note 9—Screenvision Transaction in the Interim Financial Statements) and the inability to recognize an associated deferred tax benefit, due to our ongoing assessment that the realization of our deferred tax assets is unlikely. At June 30, 2012 and December 31, 2011, our consolidated deferred tax assets were $85.0 million, before the effects of any valuation allowance. We regularly assess whether it is more likely than not that our deferred tax asset balance will be recovered from future taxable income, taking into account such factors as our earnings history, carryback and carryforward periods and tax planning strategies. When evidence exists that indicates that recovery is uncertain, a valuation allowance is established against the deferred tax asset, increasing our income tax expense in the period that such determination is made.

The effective tax rate from continuing operations for the three and six months ended June 30, 2012 was 44.8% and 42.8%, respectively. The effective tax rate differs from the statutory tax rate primarily due to temporary differences between the financial reporting basis and tax basis of our assets and liabilities and the inability to recognize an associated deferred tax benefit, due to our ongoing assessment that the realization of our deferred tax assets is unlikely.

Loss from discontinued operations, net of tax benefit. Theatres are generally considered for closure due to an expiring lease term, underperformance, or the opportunity to better deploy invested capital. During the three months ended June 30, 2012 and 2011, we closed three theatres and one theatre, respectively, and for the six months ended June 30, 2012 and 2011, we closed seven and four theatres, respectively. With respect to the closures during the three months ended June 30, 2012 and 2011, we classified three theatres in each period as discontinued operations, and for the six months ended June 30, 2012 and 2011 we classified four theatres in each period as discontinued operations. We reported the results of these operations, including gains or losses on disposal, as discontinued operations. The operations and cash flow of these theatres have been eliminated from our operations, and we will not have any continuing involvement in their operations.

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Liquidity and Capital Resources

General

We typically maintain current liabilities in excess of our current assets which results in a working capital deficit. We are able to operate with a substantial working capital deficit because our operating revenues are primarily received on a cash basis. Rather than maintain significant cash balances that would result from this pattern of operating cash flows, we utilize operating cash flows in excess of those required for investing activities to fund capital projects, including new build-to-suit theatres and acquisitions. We had a working capital surplus of $45.4 million as of June 30, 2012 compared to a working capital deficit of $33.4 million at December 31, 2011. The working capital surplus in 2012 resulted from proceeds of $56.5 million received from our common stock offering in April 2012.

At June 30, 2012, we had available borrowing capacity of $25 million under our revolving Credit Facility (as defined below) and approximately $85.8 million in cash and cash equivalents on hand as compared to $13.6 million in cash and cash equivalents at December 31, 2011. The material terms of our revolving credit facility (including limitations on our ability to freely use all the available borrowing capacity) are described below in “Credit Agreement and Covenant Compliance.”

On April 11, 2012, we issued 4.6 million shares of our common stock at a price to the public of $13.00 per share through a registered public offering, including 0.6 million shares upon the underwriters option to fully exercise the overallotment. The net proceeds from the transaction were approximately $56.4 million. The funds received from the issuance of the shares will be used for general corporate purposes, including working capital, repayment of debt, possible acquisitions and other capital expenditures.

On April 27, 2012, we issued $210.0 million aggregate principal amount of 7.375% Senior Secured Notes due 2019 (the “Senior Secured Notes”). A portion of the proceeds of the Senior Secured Notes were used to repay in full our current senior secured term loan which had an outstanding balance of $199.7 million as of March 31, 2012. Following this repayment, we retained net cash proceeds of $0.8 million from the transaction after the payment of offering and other transaction expenses which we intend to use for general corporate purposes. On April 27, 2012, we also entered into a new $25.0 million senior secured revolving credit facility (the “Credit Facility”), which was undrawn at closing, and terminated our existing credit facility. The material terms of the Senior Secured Notes and the Credit Facility are described below in “Credit Agreement and Covenant Compliance.”

Net cash provided by operating activities was $26.1 million for the six months ended June 30, 2012 compared to net cash provided by operating activities of $41.4 million for the six months ended June 30, 2011. Cash provided by operating activities was higher for the six months ended June 30, 2011 due primarily to the collection of the $30.0 million receivable from Screenvision in January 2011 partially offset by increased box office attendance during the six months ended June 30, 2012. Net cash used in investing activities was $10.3 million for the six months ended June 30, 2012 compared to $5.5 million for the six months ended June 30, 2011. The increase in our net cash used in investing activities is primarily due to an increase in cash used for the purchases of property and equipment and the acquisition of one theatre in March 2012 partially offset by a increase in proceeds from sales of property and equipment. Capital expenditures were $10.6 million and $6.2 million for the six months ended June 30, 2012 and 2011, respectively. Capital expenditures for the 2012 period were primarily due to the construction of two new build-to-suit theatres opened during the first quarter of 2012 and Big D renovations (as described below). Capital expenditures for the 2011 period related primarily to additional 3-D rollouts, Big D renovations, theatre renovations and upgrades to computer equipment. Net cash provided by financing activities was $56.3 million for the six months ended June 30, 2012 compared to net cash used in financing activities of $27.7 million for the six months ended June 30, 2011. The increase in our net cash from financing activities is primarily due to the proceeds of $56.3 million received from our common stock offering in April 2012 and the repayment of $25.0 million on our term loan during the six months ended June 30, 2011.

Our liquidity needs are funded by operating cash flow and availability under our Credit Facility. The exhibition industry is seasonal with the studios normally releasing their premiere film product during the holiday season and summer months. This seasonal positioning of film product makes our needs for cash vary significantly from quarter to quarter. Additionally, the ultimate performance of the films any time during the calendar year will have a dramatic impact on our cash flow.

We from time to time close older theatres or do not renew the leases, and the expenses associated with exiting these closed theatres typically relate to costs associated with removing owned equipment for redeployment in other locations and are not material to our operations. In the first six months of 2012, we closed seven of our underperforming theatres and estimate closing up to a total of 12 theatres for the full year 2012.

We plan to incur between $25 and $30 million in capital expenditures for calendar year 2012. We opened two new build-to-suit theatres during the first quarter of 2012 and plan to open additional theatres in 2012. In 2010, we began installing our own large digital format screen in select theatres. The Big D-Large Format Digital Experience (“Big D”) includes a larger screen,

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enhanced sound and premium seating accommodations. As of June 30, 2012, we have 13 Big D auditoriums, including one auditorium in each of our new build-to-suit theatres opened during the first quarter of 2012. We intend to roll out additional Big D auditoriums during the remainder of 2012, including one Big D auditorium in each new build-to-suit theatre.

We actively seek ways to grow our circuit through acquisitions. On March 30, 2012, we completed our purchase of certain assets from Destinta Theatres for approximately $0.7 million. The acquisition consisted of a seven screen theatre in Clarion, Pennsylvania.

7.375% Senior Secured Notes

On April 27, 2012, we issued $210.0 million aggregate principal amount of 7.375% Senior Secured Notes due May 15, 2019 (the “Senior Secured Notes”). Interest is payable on the Senior Secured Notes on May 15 and November 15 of each year, beginning on November 15, 2012. The Senior Secured Notes are fully and unconditionally guaranteed by each of our existing subsidiaries and will be guaranteed by any future domestic wholly-owned restricted subsidiaries. Debt issuance costs and other transaction fees of $8.4 million are included in prepaid expenses and other current assets and other non-current assets and amortized over the life of the debt as interest expense. The Senior Secured Notes are secured, subject to certain permitted liens, on a second priority basis by substantially all of our and our guarantors’ current and future property and assets (including the capital stock of our current subsidiaries), other than certain excluded assets.

At any time prior to May 15, 2015, we may redeem up to 35% of the aggregate principal amount of the Senior Secured Notes with the proceeds of certain equity offerings at a redemption price equal to 107.375% of the principal amount of the Senior Secured Notes, plus accrued and unpaid interest to, but excluding the redemption date; provided, however, that at least 65% of the aggregate principal amount of the Senior Secured Notes are outstanding immediately following the redemption. In addition, at any time prior to May 15, 2015, we may redeem all or a portion of the Senior Secured Notes by paying a “make-whole” premium calculated as described in the indenture governing the Senior Secured Notes (the “Indenture”).

At any time on or after May 15, 2015, we may redeem all or a portion of the Senior Secured Notes at redemption prices calculated based on a percentage of the principal amount of the Senior Secured Notes being redeemed, plus accrued and unpaid interest, if any, to the redemption date, depending on the date on which the Senior Secured Notes are redeemed. These percentages range from between 100.00% and 105.53%.

Following a change of control, as defined in the Indenture, we will be required to make an offer to repurchase all or any portion of the Senior Secured Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest to, but excluding, the date of repurchase.

The Indenture includes covenants that limit the ability of us and our restricted subsidiaries to, among other things: incur additional indebtedness or guarantee obligations; issue certain preferred stock or redeemable stock; subject to certain exceptions, pay dividends up to certain specified limits, repurchase or make distributions in respect of our capital stock or make other restricted payments; make certain investments; sell, transfer or otherwise convey certain assets; create or incur liens or other encumbrances; prepay, redeem or repurchase subordinated debt prior to stated maturities; designate our subsidiaries as unrestricted subsidiaries; consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; enter into a new or different line of business; and enter into certain transactions with our affiliates. The restrictive covenants are subject to a number of important exceptions and qualifications set forth in the Indenture.

The Indenture provides for customary events of default. If any event of default occurs and is continuing, subject to certain exceptions, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding Senior Secured Notes may declare all the Senior Secured Notes to be due and payable immediately, together with any accrued and unpaid interest, if any, to the acceleration date. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization, such amounts with respect to the Senior Secured Notes will be due and payable immediately without any declaration or other act on the part of the trustee or the holders of the Senior Secured Notes.

Revolving Credit Facility

On April 27, 2012, we entered into a revolving credit facility (the “Credit Facility”) by and among us, as borrower, the banks and other financial institutions or entities from time to time parties to the credit agreement governing the Credit Facility (the “Credit Agreement”), as lenders, and Macquarie US Trading LLC as administrative agent. Macquarie US Trading, LLC and Raymond James Bank, N.A. as lenders under the Credit Agreement as initially in effect.

The Credit Agreement provides a $25.0 million senior secured revolving credit facility having a four year term, and includes a sub-facility for the issuance of letters of credit totaling up to $10.0 million. Our obligations under the Credit Facility are guaranteed by each of our existing and future direct and indirect wholly owned domestic subsidiaries, and the obligations of us and our guarantors in respect of the Credit Facility are secured by first priority liens on substantially all of our and such subsidiaries’ current and future property and assets, other than certain excluded assets pursuant to the first lien guarantee and collateral

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agreement by and among us, such guarantors and Wells Fargo Bank, National Association, as collateral trustee. In addition, the Credit Agreement contains provisions to accommodate the incurrence of up to $150.0 million in future incremental borrowings. While the Credit Agreement does not contain any commitment by the lenders to provide this incremental indebtedness, the Credit Agreement describes how such debt (if provided by our existing or new lenders) would be subject to various financial and other covenant compliance requirements and conditions at the time the additional debt is incurred.

The interest rate for borrowings under the Credit Facility is LIBOR (subject to a 1.00% floor) plus a margin of 4.50%, or Base Rate (as defined in the Credit Facility) (subject to a 2.00% floor) plus a margin of 3.50%, as we may elect. In addition, we will be required to pay commitment fees on the unused portion of the Credit Facility at the rate of 0.50% per annum. The termination date of the Credit Facility is April 27, 2016.

The Credit Facility contains covenants which, among other things, limit our ability, and that of our subsidiaries, to:

• pay dividends up to certain specified limits or make any other restricted payments to parties other than to us;

• incur additional indebtedness and financing obligations;

• create liens on our assets;

• make certain investments;

• sell or otherwise dispose of our assets other than in the ordinary course of business;

• consolidate, merge or otherwise transfer all or any substantial part of our assets;

• enter into transactions with our affiliates; and

• engage in businesses other than those in which we are currently engaged or those reasonably related thereto.

These limitations are similar to the corresponding limitations applicable under the terms of the Indenture, except that the Credit Facility contains further limitations on our ability to incur additional indebtedness and liens. In addition, to the extent we incur certain specified levels of additional indebtedness, further limitations under the Credit Facility will become applicable under covenants related to sales of assets, sale-leaseback transactions, investment transactions, and the payment of dividends and other restricted payments. In addition, if we draw on the Credit Facility, we will be required to maintain a first lien leverage ratio as defined (the “Leverage Ratio”) not more than 2.75 to 1.00. The Credit Agreement also contains certain representations and warranties, other affirmative and negative covenants, and events of default customary for secured revolving credit facilities of this type.

Our failure to comply with any of these covenants, including compliance with the Leverage Ratio, will be an event of default under the Credit Facility, in which case the administrative agent may, with the consent or at the request of lenders holding a majority of the commitments and outstanding loans, terminate the Credit Facility and declare all or any portion of the obligations under the Credit Facility due and payable. Other events of default under the Credit Facility include:

• our failure to pay principal on the loans when due and payable, or our failure to pay interest on the loans or to pay certain fees and expenses (subject to applicable grace periods);

• the occurrence of a change of control (as defined in the Credit Agreement);

• a breach or default by us or our subsidiaries on the payment of principal of any other indebtedness in an aggregate amount greater than $10 million;

• breach of representations or warranties in any material respect;

• failure to perform other obligations under the Credit Agreement and the security documents for the Credit Facility (subject to applicable cure periods); or

• certain bankruptcy or insolvency events.

In the event of a bankruptcy or insolvency event of default, the Credit Facility will automatically terminate, and all obligations thereunder will immediately become due and payable.

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Contractual Obligations

We did not have any material changes to our contractual obligations from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2011, with the exception of the issuance of the Senior Secured Notes. The following table reflects our contractual obligations as of June 30, 2012.

	Less than one year		1-3 years		3-5 years		More than 5 years		Total
7.375% Notes1	$	—	$	—	$	—	$	210.0	$	210.0
Interest payments		14.4		31.0		31.0		32.8		109.2
Financing obligations		11.4		23.4		25.6		160.6		221.0
Capital lease obligations		6.1		12.0		11.9		22.9		52.9
Operating leases		45.2		84.4		76.9		201.6		408.1
Purchase obligations		8.1		—		—		—		8.1
Christie contract		0.2		0.3		0.3		—		0.8
Employment agreement with Chief Executive Officer		0.6		0.3		—		—		0.9
Total contractual cash obligations	$	86.0	$	151.4	$	145.7	$	627.9	$	1,011.0

(1) Includes only principal payments on the Senior Secured Notes.

Forward-Looking Information

Certain items in this report are considered forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition, we, or our executive officers on our behalf, may from time to time make forward-looking statements in reports and other documents we file with the SEC or in connection with oral statements made to the press, potential investors or others. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “plan,” “estimate,” “expect,” “project,” “anticipate,” “intend,” “believe” and other words and terms of similar meaning in connection with discussion of future operating or financial performance. These statements include, among others, statements regarding our future operating results, our strategies, sources of liquidity, debt covenant compliance, the availability of film product, our capital expenditures, and the opening and closing of theatres. These statements are based on the current expectations, estimates or projections of management and do not guarantee future performance. The forward-looking statements also involve risks and uncertainties, which could cause actual outcomes and results to differ materially from what is expressed or forecasted in these statements. As a result, these statements speak only as of the date they were made and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Our actual results and future trends may differ materially depending on a variety of factors, including:

• general economic conditions in our regional and national markets;

• our ability to comply with covenants contained in the agreements governing our indebtedness;

• our ability to operate at expected levels of cash flow;

• financial market conditions including, but not limited to, changes in interest rates and the availability and cost of capital;

• our ability to meet our contractual obligations, including all outstanding financing commitments;

• the availability of suitable motion pictures for exhibition in our markets;

• competition in our markets;

• competition with other forms of entertainment;

• the effect of leverage on our financial condition;

• prices and availability of operating supplies;

• impact of continued cost control procedures on operating results;

• the impact of asset impairments;

• the impact of terrorist acts;

• changes in tax laws, regulations and rates;

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• financial, legal, tax, regulatory, legislative or accounting changes or actions that may affect the overall performance of our business; and

• other factors, including the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2011 and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012 under the caption “Risk Factors”.

Other important assumptions and factors that could cause actual results to differ materially from those in the forward-looking statements are specified elsewhere in this report and our other SEC reports, accessible on the SEC’s website at www.sec.gov and our website at www.carmike.com.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in market risk from the information provided under “Quantitative and Qualitative Disclosures about Market Risk” in Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2011 other than as described below.

On April 27, 2012, in connection with the issuance of our 7.375% Senior Secured Notes due 2019, we repaid our outstanding term loan. Following this repayment, we do not have any material variable rate indebtedness outstanding.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, include controls and procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including the chief executive officer and the chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system are met.

As required by SEC rules, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. This evaluation was carried out under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer. Based on this evaluation, these officers have concluded that, as of June 30, 2012, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal control over financial reporting during the three months ended June 30, 2012 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

For information relating to the Company’s legal proceedings, see Note 7—Commitments and Contingencies, under Part I, Item 1 of this Quarterly Report on Form 10-Q.

ITEM 1A. RISK FACTORS

For information regarding factors that could affect the Company’s results of operations, financial condition and liquidity, see the risk factors discussed under “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and in Part II, Item 1A of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012. See also “Forward-Looking Statements,” included in Part I, Item 2 of this Quarterly Report on Form 10-Q.

There have been no material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 with the exception of the risk factors related to the issuance of the Senior Secured Notes in Part II, Item 1A of the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2012.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

Listing of exhibits

Exhibit Number	Description
3.1	Amended and Restated Certificate of Incorporation of Carmike Cinemas, Inc. (filed as Exhibit 3.1 to Carmike’s Amendment to Form 8-A filed January 31, 2002 and incorporated herein by reference).
3.2	Certificate of Amendment to amended and Restated Certificate of Incorporation of Carmike Cinemas, Inc, (filed as Exhibit 3.1 to Carmike’s Current Report on Form 8-K filed May 21, 2010 and incorporated herein by reference).
3.3	Amended and Restated By-Laws of Carmike Cinemas, Inc. (filed as Exhibit 3.1 to Carmike’s Current Report on Form 8-K filed on January 22, 2009 and incorporated herein by reference).
4.1	Indenture for 7.375% Senior Secured Notes due 2019, dated April 27, 2012, among Carmike Cinemas, Inc., the subsidiary guarantors party thereto and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
4.2	Registration Rights Agreement for 7.375% Senior Secured Notes due 2019, dated April 27, 2012, among Carmike Cinemas, Inc. and Macquarie Capital (USA) Inc. (filed as Exhibit 4.2 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
4.3	Form of 7.375% Senior Secured Note due 2019 (included in Exhibit 4.1).
10.1	Credit Agreement, dated April 27, 2012, by and among Carmike Cinemas, Inc., as Borrower, the several lenders from time to time parties to the Credit Agreement, Macquarie US Trading LLC, as Administrative Agent and Syndication Agent, and Macquarie Capital USA (Inc.) as Sole Lead Arranger and Sole Bookrunner (filed as Exhibit 10.1 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
10.2	Second Lien Guarantee Collateral Agreement, dated April 27, 2012, among Carmike Cinemas, Inc., the other Guarantors party thereto, Wells Fargo Bank, National Association, as Collateral Trustee (filed as Exhibit 10.2 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
10.3	Collateral Trust Agreement, dated April 27, 2012, between Carmike Cinemas, Inc., the Guarantors from time to time party thereto, Macquarie US Trading LLC, as Administrative Agent under the Credit Agreement and Wells Fargo Bank, National Association, as Trustee under the Indenture and as Collateral Trustee (filed as Exhibit 10.3 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
10.4	First Lien Guarantee and Collateral Agreement between Carmike Cinemas, Inc. and certain of its Subsidiaries in favor of Wells Fargo Bank, National Association, as Collateral Trustee (filed as Exhibit 10.4 to Carmike’s Current Report on Form 8-K filed on April 30, 2012).
10.5	Carmike Cinemas, Inc. Section 162(m) Performance-Based Program (filed as Appendix A to Carmike’s Definitive Proxy Statement for the 2012 Annual Meeting of Stockholders, filed on April 20, 2012 and incorporated herein by reference).
10.6	Amendment No. 2 to Employment Agreement between Carmike Cinemas, Inc. and S. David Passman III.
10.7	Amendment No. 2 to Separation Agreement between Carmike Cinemas, Inc. and Richard B. Hare.
10.8	Amendment No. 3 to Separation Agreement between Carmike Cinemas, Inc. and Fred W. Van Noy.
11	Computation of per share earnings (provided in Note 8 of the notes to condensed consolidated financial statements included in this report under the caption “Net Income (Loss) Per Share”).
31.1	Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

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Exhibit Number	Description
31.2	Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certificate of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certificate of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial information for Carmike, formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Cash Flows, and (iv) the Notes to the Condensed Consolidated Financial Statements, tagged as detailed text.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	CARMIKE CINEMAS, INC.
Date: August 1, 2012	By:	/s/ S. David Passman III
		S. David Passman III
		President, Chief Executive Officer and Director (Principal Executive Officer)
Date: August 1, 2012	By:	/s/ Richard B. Hare
		Richard B. Hare
		Senior Vice President—Finance, Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer)

35

EX-10.6

Exhibit 10.6

AMENDMENT NUMBER TWO TO EMPLOYMENT AGREEMENT

This Amendment Number Two to Employment Agreement (this “Amendment”) is made and entered into as of March 8, 2012 by and between Carmike Cinemas, Inc. (“Carmike”) and S. David Passman III ( “Executive”).

WHEREAS, Carmike and Executive entered into an Employment Agreement dated as of June 4, 2009, as amended by Amendment No. 1 thereto dated as of March 29, 2010 (the “Employment Agreement”), pursuant to which Carmike employs Executive as its President and Chief Executive Officer;

WHEREAS, Carmike and Executive desire to amend the Employment Agreement to increase the monthly apartment allowance to $4,000, to remove references to Executive’s relocation of his residence to Columbus, Georgia and to clarify certain provisions for purposes of Section 409A of the Internal Revenue Code of 1986, as amended;

NOW, THEREFORE, in consideration of the mutual promises, terms, covenants, and conditions set forth herein, Carmike and Executive hereby amend the Employment Agreement as follows, effective as of March 8, 2012:

1.

By amending Section 4.1, Reimbursement, to read as follows:

Reimbursement. Carmike shall reimburse Executive for (or, at Carmike’s option, pay) all reasonable and proper business travel and other out-of pocket expenses incurred by Executive in the performance of his duties and responsibilities to Carmike during the Term. All reimbursable expenses shall be appropriately documented in reasonable detail by Executive upon submission of any request for reimbursement, and in a format and manner consistent with Carmike’s expense reporting and reimbursement policies. The following provisions shall apply to all taxable reimbursement of expenses, including the reimbursements (and compensation for income taxes or tax liability) described in Sections 4.2, 4.3 and 7.1(d), to the extent that such taxable reimbursement is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)): All approved reimbursements for which appropriate invoices are presented shall be paid within a reasonable time and not later than the last day of the calendar year following the calendar year in which the reimbursed expense was incurred. Any expenses reimbursed during any calendar year will not affect the expenses reimbursed by Carmike in another calendar year. Executive’s right to reimbursement of expenses is not subject to liquidation or exchange for another benefit.

2.

By amending Section 4.3, Apartment Allowance, to read as follows:

Apartment Allowance. Executive shall be entitled to reimbursement for reasonable expenses incurred to lease an apartment in Columbus, Georgia, up to, but not exceeding $4,000 per calendar month. If any expense reimbursed pursuant to this § 4.3 is considered taxable income to Executive, Carmike shall compensate Executive for any income taxes owed by Executive related to such reimbursement, such that after such income taxes have been paid, the apartment expenses are fully reimbursed by Carmike.

3.

By amending Section 7.1(e) to read as follows:

If Executive is a “specified employee” (as defined in Treas. Reg. § 1.409A-1(i)), then each payment to which Executive is entitled under § 7.1 that is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)) shall be delayed until the date which is six (6) months and one (1) day after the date Executive has a “separation from service” (as defined in Treas. Reg. § 1.409A-1(h)).

4.

By amending Section 7.6, General Release, to read as follows:

General Release. The separation benefit provided in § 7.1 shall not be paid unless Executive signs a General Release of claims in a form reasonably acceptable to Carmike and such general release shall have become irrevocable on or before the end of the sixty (60) day period beginning on Executive’s “separation from service” (as such term is defined in Treas. Reg. § 1.409A-1(h)) and subject to § 7.1(e), payments described in § 7.1 shall commence on the sixtieth (60^th) day following Executive’s separation from service. Notwithstanding the foregoing sentence, nothing in this § 7.6 is intended to increase the amount of benefits provided under § 7.1.

5.

Except as otherwise expressly amended herein, the terms and conditions of the Employment Agreement as in effect immediately before the effective date of this Amendment shall remain in full force and effect.

[Signature Page Follows]

IN WITNESS WHEREOF, Carmike and Executive have executed this Amendment Number Two as of the date first set forth above.

CARMIKE CINEMAS, INC.
By:	/s/ Daniel E. Ellis
	Daniel E. Ellis
	Senior Vice President, General Counsel and Secretary

EXECUTIVE
	/s/ S. David Passman III
	S. David Passman III

EX-10.7

Exhibit 10.7

AMENDMENT NUMBER TWO TO SEPARATION AGREEMENT

This Amendment Number Two to Separation Agreement (this “Amendment”) is made and entered into as of June 11, 2012 by and between Carmike Cinemas, Inc. (“Carmike”) and Richard B. Hare (“Executive”).

WHEREAS, Carmike and Executive entered into a Separation Agreement dated as of May 18, 2007, as amended by Amendment Number One thereto dated as of December 29, 2008 (the “Separation Agreement”), to address certain benefits payable to Executive upon termination of employment;

WHEREAS, Carmike and Executive desire to amend the Separation Agreement to clarify certain provisions for purposes of Section 409A of the Internal Revenue Code of 1986, as amended;

NOW, THEREFORE, in consideration of the mutual promises, terms, covenants, and conditions set forth herein, Carmike and Executive hereby amend the Separation Agreement as follows, effective as of January 1, 2009:

1.

By amending Section 2.1(e) to read as follows:

“If Executive is a “specified employee” (as defined in Treas. Reg. § 1.409A-1(i)), then the timing of payments to which Executive is entitled shall be determined in accordance with § 4.13.”

2.

By amending Section 4.13, Compliance with § 409A of the Code, to read as follows:

“Compliance with § 409A of the Code. To the extent this Agreement is subject to § 409A of the Code, the Executive and Carmike intend all payments under this Agreement to comply with the requirements of such section, and this Agreement shall, to the extent practical, be operated and administered to effectuate such intent. If Executive is a “specified employee” (as defined in Treas. Reg. § 1.409A-1(i)), then each payment to which Executive is entitled under § 2.1 that is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)) shall be delayed until the date which is six (6) months and one (1) day after the date Executive has a “separation from service” (as defined in Treas. Reg. § 1.409A-1(h)). To the extent that any taxable reimbursement of expenses, including the reimbursements (and compensation for income taxes or tax liability) described in § 2.1(d), is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)): (i) all approved reimbursements shall be paid within a reasonable time and not later than the last day of the calendar year

following the calendar year in which the reimbursed expense was incurred, (ii) any expenses reimbursed during any calendar year shall not affect the expenses reimbursed by Carmike in another calendar year, and (iii) Executive’s right to reimbursement of expenses shall not be subject to liquidation or exchange for another benefit.”

3.

Except as otherwise expressly amended herein, the terms and conditions of the Separation Agreement as in effect immediately before the effective date of this Amendment shall remain in full force and effect.

IN WITNESS WHEREOF, Carmike and Executive have executed this Amendment Number Two as of the date first set forth above.

CARMIKE CINEMAS, INC.
By:	/s/ Daniel E. Ellis
	Daniel E. Ellis
	Senior Vice President, General Counsel and Secretary

EXECUTIVE

/s/ Richard B. Hare

Richard B. Hare

EX-10.8

Exhibit 10.8

AMENDMENT NUMBER THREE TO SEPARATION AGREEMENT

This Amendment Number Three to Separation Agreement (this “Amendment”) is made and entered into as of June 11, 2012 by and between Carmike Cinemas, Inc. (“Carmike”) and Fred W. Van Noy ( “Executive”).

WHEREAS, Carmike and Executive entered into a Separation Agreement, as amended by Amendment Number One thereto dated as of December 19, 2008 and Amendment Number Two thereto dated as of March 4, 2011 (the “Separation Agreement”), to address certain benefits payable to Executive upon termination of employment;

WHEREAS, Carmike and Executive desire to amend the Separation Agreement to clarify certain provisions for purposes of Section 409A of the Internal Revenue Code of 1986, as amended;

NOW, THEREFORE, in consideration of the mutual promises, terms, covenants, and conditions set forth herein, Carmike and Executive hereby amend the Separation Agreement as follows, effective as of January 1, 2009:

1.

By amending Section 2.1(e) to read as follows:

“If Executive is a “specified employee” (as defined in Treas. Reg. § 1.409A-1(i)), then the timing of payments to which Executive is entitled shall be determined in accordance with § 5.13.”

2.

By amending Section 5.13, Compliance with § 409A of the Code, to read as follows:

“Compliance with § 409A of the Code. To the extent this Agreement is subject to § 409A of the Code, the Executive and Carmike intend all payments under this Agreement to comply with the requirements of such section, and this Agreement shall, to the extent practical, be operated and administered to effectuate such intent. If Executive is a “specified employee” (as defined in Treas. Reg. § 1.409A-1(i)), then each payment to which Executive is entitled under § 2.1 that is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)) shall be delayed until the date which is six (6) months and one (1) day after the date Executive has a “separation from service” (as defined in Treas. Reg. § 1.409A-1(h)). To the extent that any taxable reimbursement of expenses, including the reimbursements (and compensation for income taxes or tax liability) described in § 2.1(d), is a payment of deferred compensation from a “nonqualified deferred compensation plan” (as defined in Treas. Reg. § 1.409A-1(a)): (i) all approved reimbursements shall be

paid within a reasonable time and not later than the last day of the calendar year following the calendar year in which the reimbursed expense was incurred, (ii) any expenses reimbursed during any calendar year shall not affect the expenses reimbursed by Carmike in another calendar year, and (iii) Executive’s right to reimbursement of expenses shall not be subject to liquidation or exchange for another benefit.”

3.

Except as otherwise expressly amended herein, the terms and conditions of the Separation Agreement as in effect immediately before the effective date of this Amendment shall remain in full force and effect.

IN WITNESS WHEREOF, Carmike and Executive have executed this Amendment Number Three as of the date first set forth above.

CARMIKE CINEMAS, INC.
By:	/s/ Daniel E. Ellis
	Daniel E. Ellis
	Senior Vice President, General Counsel and Secretary
EXECUTIVE /s/ Fred W. Van Noy
Fred W. Van Noy

EX-31.1

Exhibit 31.1

CERTIFICATE OF CHIEF EXECUTIVE OFFICER

I, S. David Passman III, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Carmike Cinemas, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 1, 2012

/s/ S. David Passman III

S. David Passman III

President, Chief Executive Officer and

Director

EX-31.2

Exhibit 31.2

CERTIFICATE OF CHIEF FINANCIAL OFFICER

I, Richard B. Hare, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Carmike Cinemas, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 1, 2012

/s/ Richard B. Hare

Richard B. Hare

Senior Vice President-Finance, Treasurer and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Carmike Cinemas, Inc. on Form 10-Q for the period ended June 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, S. David Passman III, the Chief Executive Officer of the registrant, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

Date: August 1, 2012

/s/ S. David Passman III

S. David Passman III

President, Chief Executive Officer and

Director

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Carmike Cinemas, Inc. on Form 10-Q for the period ended June 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard B. Hare, Chief Financial Officer of the registrant, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the issuer.

Date: August 1, 2012

/s/ Richard B. Hare

Richard B. Hare

Senior Vice President-Finance, Treasurer and Chief

Financial Officer

XML

Investments in Unconsolidated Affiliates (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Assets:
Current assets	$ 40,349		$ 40,349
Noncurrent assets	163,743		163,743
Total assets	204,092		204,092
Liabilities:
Current liabilities	40,792		40,792
Noncurrent liabilities	86,424		86,424
Total liabilities	127,216		127,216
Results of operations:
Revenue	31,403	45,934	54,187	68,942
Net loss	$ (5,328)	$ 6	$ (13,697)	$ (7,735)

XML

Equity Based Compensation (Details Textual) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011
Equity Based Compensation (Textual) [Abstract]
Performance-based awards outstanding	440,924		440,924		248,804
Equity Based Compensation (Additional Textual) [Abstract]
Shares available for future grants Under 2004 Incentive Stock Plan	1,309,684		1,309,684
Performance-based stock awards earned			96,083
Stock-based compensation expense	$ 638	$ 724	$ 1,101	$ 1,188
Total unrecognized compensation cost	4,070		4,070
Weighted-average period for recognition of unrecognized compensation cost			2 years 2 months 12 days
Options granted			0
Accelerate vesting of stock-based awards	$ 115	$ 222	$ 115	$ 222
Estimated forfeiture rate			5.00%
Restricted stock [Member] | Minimum [Member]
Equity Based Compensation (Textual) [Abstract]
Vesting period			1 year
Compensation expense, recognition period			1 year
Restricted stock [Member] | Maximum [Member]
Equity Based Compensation (Textual) [Abstract]
Vesting period			3 years
Compensation expense, recognition period			3 years
Performance-based awards [Member]
Equity Based Compensation (Textual) [Abstract]
Vesting period			3 years
Performance-based awards outstanding dependent on performance criteria	240,083		240,083

XML

Impairment of Long-Lived Assets (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Impairment of Long-Lived Assets (Additional Textual) [Abstract]
Impairment charges	$ 50	$ 1,164	$ 1,536	$ 1,325
Estimated aggregate fair value of long-lived assets impaired	$ 870		$ 5,677
Minimum [Member]
Impairment of Long-Lived Assets (Textual) [Abstract]
Projected future attendance fluctuations			(10.00%)
Risk-adjusted rate of return			10.00%
Maximum [Member]
Impairment of Long-Lived Assets (Textual) [Abstract]
Projected future attendance fluctuations			10.00%
Risk-adjusted rate of return			15.00%

XML

Guarantor Subsidiaries (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2011	Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 85,779	$ 13,616	$ 21,234	$ 13,066
Restricted cash	17	331
Accounts receivable	5,659	4,985
Inventories	2,945	2,955
Prepaid expenses and other assets	9,969	9,410
Total current assets	104,369	31,297
Property and equipment:
Land	53,695	53,909
Buildings and building improvements	273,148	276,221
Leasehold improvements	121,607	123,547
Assets under capital leases	44,970	44,970
Equipment	214,664	212,457
Construction in progress	3,535	2,349
Total property and equipment	711,619	713,453
Accumulated depreciation and amortization	(364,059)	(357,518)
Property and equipment, net of accumulated depreciation	347,560	355,935
Intercompany receivables
Investment in subsidiaries
Goodwill	8,087	8,087
Intangible assets, net of accumulated amortization	1,115	1,169
Investments in unconsolidated affiliates	6,503	8,498
Other assets	21,824	17,870
Total assets	489,458	422,856
Current liabilities:
Accounts payable	22,649	29,583
Accrued expenses	34,156	31,136
Current maturities of long-term debt, capital leases and long-term financing obligations	2,122	3,959
Total current liabilities	58,927	64,678
Long-term liabilities:
Long-term debt, less current maturities	209,512	196,880
Capital leases and long-term financing obligations, less current maturities	113,720	114,608
Intercompany liabilities
Deferred revenue	33,567	34,009
Other	17,251	18,306
Total long-term liabilities	374,050	363,803
Stockholders' equity (deficit):
Preferred Stock
Common Stock	539	401
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively	(11,740)	(11,683)
Paid-in capital	348,593	290,997
Accumulated deficit	(280,911)	(285,340)
Total stockholders' equity (deficit)	56,481	(5,625)
Total liabilities and stockholders' equity (deficit)	489,458	422,856
Carmike Cinemas, Inc [Member]
Current assets:
Cash and cash equivalents	72,966	3,623	13,124	3,418
Restricted cash	17	331
Accounts receivable	4,855	4,654
Inventories	719	722
Prepaid expenses and other assets	5,350	4,953
Total current assets	83,907	14,283
Property and equipment:
Land	12,716	12,716
Buildings and building improvements	46,923	46,676
Leasehold improvements	19,625	19,307
Assets under capital leases	8,675	8,675
Equipment	58,972	58,128
Construction in progress	1,535	159
Total property and equipment	148,446	145,661
Accumulated depreciation and amortization	(79,054)	(75,760)
Property and equipment, net of accumulated depreciation	69,392	69,901
Intercompany receivables	104,155	123,071
Investment in subsidiaries	90,268	82,985
Goodwill
Intangible assets, net of accumulated amortization
Investments in unconsolidated affiliates	5,546	8,498
Other assets	15,639	10,536
Total assets	368,907	309,274
Current liabilities:
Accounts payable	19,784	27,598
Accrued expenses	15,812	19,752
Current maturities of long-term debt, capital leases and long-term financing obligations	398	2,391
Total current liabilities	35,994	49,741
Long-term liabilities:
Long-term debt, less current maturities	209,512	196,880
Capital leases and long-term financing obligations, less current maturities	28,058	28,223
Intercompany liabilities
Deferred revenue	33,567	34,009
Other	5,295	6,045
Total long-term liabilities	276,432	265,157
Stockholders' equity (deficit):
Common Stock	539	401
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively	(11,740)	(11,683)
Paid-in capital	348,593	290,997
Accumulated deficit	(280,911)	(285,340)
Total stockholders' equity (deficit)	56,481	(5,625)
Total liabilities and stockholders' equity (deficit)	368,907	309,274
Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	12,813	9,993	8,110	9,648
Restricted cash
Accounts receivable	804	331
Inventories	2,226	2,233
Prepaid expenses and other assets	4,619	4,457
Total current assets	20,462	17,014
Property and equipment:
Land	40,979	41,193
Buildings and building improvements	226,225	229,545
Leasehold improvements	101,982	104,240
Assets under capital leases	36,295	36,295
Equipment	155,692	154,329
Construction in progress	2,000	2,190
Total property and equipment	563,173	567,792
Accumulated depreciation and amortization	(285,005)	(281,758)
Property and equipment, net of accumulated depreciation	278,168	286,034
Intercompany receivables
Investment in subsidiaries
Goodwill	8,087	8,087
Intangible assets, net of accumulated amortization	1,115	1,169
Investments in unconsolidated affiliates	957
Other assets	6,185	7,334
Total assets	314,974	319,638
Current liabilities:
Accounts payable	2,865	1,985
Accrued expenses	18,344	11,384
Current maturities of long-term debt, capital leases and long-term financing obligations	1,724	1,568
Total current liabilities	22,933	14,937
Long-term liabilities:
Long-term debt, less current maturities
Capital leases and long-term financing obligations, less current maturities	85,662	86,385
Intercompany liabilities	104,155	123,071
Deferred revenue
Other	11,956	12,261
Total long-term liabilities	201,773	221,717
Stockholders' equity (deficit):
Common Stock	1	1
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively
Paid-in capital	237,800	237,800
Accumulated deficit	(147,533)	(154,816)
Total stockholders' equity (deficit)	90,268	82,985
Total liabilities and stockholders' equity (deficit)	314,974	319,638
Eliminations [Member]
Current assets:
Cash and cash equivalents
Restricted cash
Accounts receivable
Inventories
Prepaid expenses and other assets
Total current assets
Property and equipment:
Land
Buildings and building improvements
Leasehold improvements
Assets under capital leases
Equipment
Construction in progress
Total property and equipment
Accumulated depreciation and amortization
Property and equipment, net of accumulated depreciation
Intercompany receivables	(104,155)	(123,071)
Investment in subsidiaries	(90,268)	(82,985)
Goodwill
Intangible assets, net of accumulated amortization
Investments in unconsolidated affiliates
Other assets
Total assets	(194,423)	(206,056)
Current liabilities:
Accounts payable
Accrued expenses
Current maturities of long-term debt, capital leases and long-term financing obligations
Total current liabilities
Long-term liabilities:
Long-term debt, less current maturities
Capital leases and long-term financing obligations, less current maturities
Intercompany liabilities	(104,155)	(123,071)
Deferred revenue
Other
Total long-term liabilities	(104,155)	(123,071)
Stockholders' equity (deficit):
Common Stock	(1)	(1)
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively
Paid-in capital	(237,800)	(237,800)
Accumulated deficit	147,533	154,816
Total stockholders' equity (deficit)	(90,268)	(82,985)
Total liabilities and stockholders' equity (deficit)	$ (194,423)	$ (206,056)

XML

Net Income (Loss) Per Share (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Net Income (Loss) Per Share (Textual) [Abstract]
Common stock equivalents excluded from the calculation of diluted loss per share	400,377	1,004,577	253,599	1,180,908

XML

Income Taxes

6 Months Ended

Jun. 30, 2012

Income Taxes [Abstract]

INCOME TAXES

NOTE 4—INCOME TAXES

The Company’s effective income tax rate is based on expected income, statutory tax rates, tax planning opportunities available in the various jurisdictions in which it operates and the impact of valuation allowances against deferred tax assets. For interim financial reporting, the Company estimates the annual income tax rate based on projected taxable income for the full year and records a quarterly income tax provision or benefit in accordance with the anticipated annual rate. The Company refines the estimates of the year’s taxable income as new information becomes available, including actual year-to-date financial results. This continual estimation process often results in a change to the expected effective income tax rate for the year. When this occurs, the Company adjusts the income tax provision during the quarter in which the change in estimate occurs so that the year-to-date provision reflects the expected annual income tax rate. Significant judgment is required in determining the effective tax rate and in evaluating the tax positions.

The effective tax rate from continuing operations for the three months ended June 30, 2012 was 44.8%. The effective tax rate from continuing operations for the six months ended June 30, 2012 was 42.8%. The Company’s tax rates for the three and six months ended June 30, 2012 differ from the statutory tax rate primarily due to temporary differences between the financial reporting basis and tax basis of our assets and liabilities and the inability to recognize an associated deferred tax benefit, due to our ongoing assessment that the realization of our deferred tax assets is unlikely.

As a result of the Company’s history of operating losses, the Company’s net deferred tax assets are fully offset by a valuation allowance at June 30, 2012 and December 31, 2011.

The Company regularly assesses whether it is more likely than not that its deferred tax asset balance will be recovered from future taxable income, taking into account such factors as its earnings history, carryback and carryforward periods, and tax planning strategies. When evidence exists that indicates that recovery is uncertain, a valuation allowance is maintained against the deferred tax asset. At this time, the Company does not believe that realization of its deferred tax assets is more likely than not to occur.

The Company recognizes a tax benefit associated with an uncertain tax position when, in the Company’s judgment, it is more likely than not that the position will be sustained upon examination by a taxing authority. For a tax position that meets the more-likely-than-not recognition threshold, the Company initially and subsequently measures the tax benefit as the largest amount that the Company judges to have a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority.

As of June 30, 2012 and December 31, 2011, the amount of unrecognized tax benefits was $2,500, all of which would affect the Company’s annual effective tax rate, if recognized. This unrecognized tax benefit is associated with the Company’s non-forfeitable ownership interest in SV Holdco, LLC (see Note 9—Screenvision Exhibition, Inc.). The Company has recognized a tax basis for these units that is lower than their carrying value for financial statement purposes. However, as this tax position may not be sustained upon examination, the Company has recorded a related liability for this uncertain tax position.

XML

Guarantor Subsidiaries (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Revenues:
Admissions	$ 86,936	$ 84,680	$ 170,126	$ 145,720
Concessions and other	49,355	46,794	96,872	81,467
Total operating revenues	136,291	131,474	266,998	227,187
Operating costs and expenses:
Film exhibition costs	48,533	46,623	92,040	78,699
Concession costs	5,510	5,329	11,102	9,195
Other theatre operating costs	52,707	49,448	105,254	98,461
General and administrative expenses	5,174	4,496	10,174	9,229
Severance agreement charges	493	845	493	845
Depreciation and amortization	7,756	7,874	15,542	15,662
Loss on sale of property and equipment		80	248	60
Write-off of note receivable		750		750
Impairment of long-lived assets	50	1,164	1,536	1,325
Total operating costs and expenses	120,223	116,609	236,389	214,226
Operating income	16,068	14,865	30,609	12,961
Interest expense	8,611	8,631	16,874	17,784
Loss on extinguishment of debt	4,961		4,961
Equity in earnings loss of subsidiaries
Income (loss) before income tax and (loss) income from unconsolidated affiliates	2,496	6,234	8,774	(4,823)
Income tax (benefit) expense	918	794	3,332	7,289
(Loss) income from unconsolidated affiliates	(448)	497	(992)	(304)
Income (loss) from continuing operations	1,130	5,937	4,450	(12,416)
Loss from discontinued operations	68	(54)	(21)	(99)
Net income (loss)	1,198	5,883	4,429	(12,515)
Carmike Cinemas, Inc [Member]
Revenues:
Admissions	14,254	14,131	28,029	25,124
Concessions and other	14,982	14,623	29,804	26,298
Total operating revenues	29,236	28,754	57,833	51,422
Operating costs and expenses:
Film exhibition costs	8,006	7,836	15,238	13,656
Concession costs	999	972	2,014	1,716
Other theatre operating costs	10,337	10,382	21,530	20,408
General and administrative expenses	4,588	3,984	9,016	8,169
Severance agreement charges	493	845	493	845
Depreciation and amortization	1,716	1,691	3,425	3,294
Loss on sale of property and equipment		67	20	67
Write-off of note receivable	750		750
Impairment of long-lived assets	4	786	13	908
Total operating costs and expenses	26,143	27,313	51,749	49,813
Operating income	3,093	1,441	6,084	1,609
Interest expense	(2,363)	2,738	4,882	5,976
Loss on extinguishment of debt	4,961		4,961
Equity in earnings loss of subsidiaries	(3,912)	(7,483)	(7,306)	519
Income (loss) before income tax and (loss) income from unconsolidated affiliates	(319)	6,186	3,547	(4,919)
Income tax (benefit) expense	(2,034)	784	(2,109)	7,526
(Loss) income from unconsolidated affiliates	(518)	405	(1,172)	(445)
Income (loss) from continuing operations	1,197	5,807	4,484	(12,620)
Loss from discontinued operations	1	76	(55)	105
Net income (loss)	1,198	5,883	4,429	(12,515)
Guarantor Subsidiaries [Member]
Revenues:
Admissions	72,682	70,549	142,097	120,596
Concessions and other	40,980	38,534	79,988	66,434
Total operating revenues	113,662	109,083	222,085	187,030
Operating costs and expenses:
Film exhibition costs	40,527	38,787	76,802	65,043
Concession costs	4,511	4,357	9,088	7,479
Other theatre operating costs	48,977	45,429	96,644	89,318
General and administrative expenses	586	512	1,158	1,060
Severance agreement charges
Depreciation and amortization	6,040	6,183	12,117	12,368
Loss on sale of property and equipment		13	228	(7)
Write-off of note receivable
Impairment of long-lived assets	46	378	1,523	417
Total operating costs and expenses	100,687	95,659	197,560	175,678
Operating income	12,975	13,424	24,525	11,352
Interest expense	(6,248)	5,893	11,992	11,808
Loss on extinguishment of debt
Equity in earnings loss of subsidiaries
Income (loss) before income tax and (loss) income from unconsolidated affiliates	6,727	7,531	12,533	(456)
Income tax (benefit) expense	2,952	10	5,441	33
(Loss) income from unconsolidated affiliates	70	92	180	141
Income (loss) from continuing operations	3,845	7,613	7,272	(315)
Loss from discontinued operations	67	(130)	34	(204)
Net income (loss)	3,912	7,483	7,306	(519)
Eliminations [Member]
Revenues:
Admissions
Concessions and other	(6,607)	(6,363)	(12,920)	(11,265)
Total operating revenues	(6,607)	(6,363)	(12,920)	(11,265)
Operating costs and expenses:
Film exhibition costs
Concession costs
Other theatre operating costs	(6,607)	(6,363)	(12,920)	(11,265)
General and administrative expenses
Severance agreement charges
Depreciation and amortization
Loss on sale of property and equipment
Write-off of note receivable
Impairment of long-lived assets
Total operating costs and expenses	(6,607)	(6,363)	(12,920)	(11,265)
Operating income
Interest expense
Loss on extinguishment of debt
Equity in earnings loss of subsidiaries	3,912	7,483	7,306	(519)
Income (loss) before income tax and (loss) income from unconsolidated affiliates	(3,912)	(7,483)	(7,306)	519
Income tax (benefit) expense
(Loss) income from unconsolidated affiliates
Income (loss) from continuing operations	(3,912)	(7,483)	(7,306)	519
Loss from discontinued operations
Net income (loss)	$ (3,912)	$ (7,483)	$ (7,306)	$ 519

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Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012	Dec. 31, 2011
Income Taxes (Textual) [Abstract]
Effective tax rate from continuing operations	44.80%	42.80%
Minimum probability of realization		greater than 50%
Unrecognized tax benefits	$ 2,500	$ 2,500	$ 2,500

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Debt (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended				3 Months Ended	6 Months Ended						6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2012 Maximum [Member]	Jun. 30, 2012 Minimum [Member]	Jun. 30, 2012 7.375% Senior Secured Notes [Member]	Jun. 30, 2012 7.375% Senior Secured Notes [Member]	Jun. 30, 2012 7.375% Senior Secured Notes [Member] Maximum [Member]	Jun. 30, 2012 7.375% Senior Secured Notes [Member] Minimum [Member]	Jun. 30, 2012 Secured term loan facility [Member]	Jun. 30, 2012 Revolving credit facility [Member]	Mar. 31, 2011 Revolving credit facility [Member]	Jun. 30, 2012 Interest rate option, LIBOR based [Member] Revolving credit facility [Member]	Jun. 30, 2012 Interest rate option, Base Rate based [Member] Revolving credit facility [Member]
Debt (Textual) [Abstract]
Maximum borrowing capacity											$ 25,000	$ 30,000
Loss on extinguishment of debt	(4,961)	(4,961)				4,961	4,961
Debt issuance costs							8,600
Date of maturity		42487								January 2016	January 2013
Percentage of aggregate principal amount, maximum redeemable								35.00%
Percentage of principal amount, redemption price							107.375%
Minimum percentage of aggregate principal amount outstanding, excluding the redemption date									65.00%
Percentage of principal amount redeemed at redemption date								105.53%	100.00%
Repurchase of Senior Secured Notes, purchase price percentage							101.00%
Interest rate description													LIBOR (subject to a 1.00% floor) plus a margin of 4.50%,	Base Rate (subject to a 2.00% floor) plus a margin 3.50%
Interest rate						7.375%	7.375%						1.00%	2.00%
Interest rate, margin added													4.50%	3.50%
Leverage ratio				2.75	1.00
Commitment fees on unused portion of the facility													0.50%
Stated principal amount at time of issuance						210,000	210,000			265,000
Default in payment of principal					10,000
Debt (Additional Textual) [Abstract]
Unamortized discount on term loan	488	488	1,306
Issuance of letters of credit	10,000	10,000
Provisions in future incremental borrowings	150,000	150,000
Minimum percentage of senior secured term loan for interest rate protection		25.00%
Aggregate principal amount of outstanding term loan	$ 198,700	$ 198,700

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Guarantor Subsidiaries (Details 2) (USD $) In Thousands, unless otherwise specified	0 Months Ended	6 Months Ended
	Apr. 11, 2012	Jun. 30, 2012	Jun. 30, 2011
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash (used in) provided by operating activities		$ 26,129	$ 41,404
Cash flows from investing activities:
Purchases of property and equipment		(10,626)	(6,248)
Theatre acquisition		(702)
Proceeds from sale of property and equipment		700	444
Other investing activities		314	279
Net cash used in investing activities		(10,314)	(5,525)
Cash flows from financing activities:
Short-term borrowings		5,000
Repayment of short-term borrowings		(5,000)
Issuance of long-term debt		209,500
Repayments of long-term debt		(200,229)	(26,161)
Debt issuance costs		(8,599)	(588)
Repayments of capital lease and long-term financing obligations		(900)	(962)
Issuance of common stock	56,300	56,633
Purchase of treasury stock		(57)
Intercompany receivable/payable
Other financing activities		(588)
Net cash provided by (used in) financing activities		56,348	(27,711)
Increase in cash and cash equivalents		72,163	8,168
Cash and cash equivalents at beginning of period		13,616	13,066
Cash and cash equivalents at end of period		85,779	21,234
Carmike Cinemas, Inc [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash (used in) provided by operating activities		(2,151)	24,870
Cash flows from investing activities:
Purchases of property and equipment		(4,855)	(2,293)
Theatre acquisition
Proceeds from sale of property and equipment		33	6
Other investing activities		314	279
Net cash used in investing activities		(4,508)	(2,008)
Cash flows from financing activities:
Short-term borrowings		5,000
Repayment of short-term borrowings		(5,000)
Issuance of long-term debt		209,500
Repayments of long-term debt		(200,229)	(26,279)
Debt issuance costs		(8,599)
Repayments of capital lease and long-term financing obligations		(162)
Issuance of common stock		56,633
Purchase of treasury stock		(57)
Intercompany receivable/payable		18,916	13,711
Other financing activities		(588)
Net cash provided by (used in) financing activities		76,002	(13,156)
Increase in cash and cash equivalents		69,343	9,706
Cash and cash equivalents at beginning of period		3,623	3,418
Cash and cash equivalents at end of period		72,966	13,124
Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash (used in) provided by operating activities		28,280	16,534
Cash flows from investing activities:
Purchases of property and equipment		(5,771)	(3,955)
Theatre acquisition		(702)
Proceeds from sale of property and equipment		667	438
Other investing activities
Net cash used in investing activities		(5,806)	(3,517)
Cash flows from financing activities:
Short-term borrowings
Repayment of short-term borrowings
Issuance of long-term debt
Repayments of long-term debt			(844)
Debt issuance costs
Repayments of capital lease and long-term financing obligations		(738)
Issuance of common stock
Purchase of treasury stock
Intercompany receivable/payable		(18,916)	(13,711)
Other financing activities
Net cash provided by (used in) financing activities		(19,654)	(14,555)
Increase in cash and cash equivalents		2,820	(1,538)
Cash and cash equivalents at beginning of period		9,993	9,648
Cash and cash equivalents at end of period		12,813	8,110
Eliminations [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash (used in) provided by operating activities
Cash flows from investing activities:
Purchases of property and equipment
Theatre acquisition
Proceeds from sale of property and equipment
Other investing activities
Net cash used in investing activities
Cash flows from financing activities:
Short-term borrowings
Repayment of short-term borrowings
Issuance of long-term debt
Repayments of long-term debt
Debt issuance costs
Repayments of capital lease and long-term financing obligations
Issuance of common stock
Purchase of treasury stock
Intercompany receivable/payable
Other financing activities
Net cash provided by (used in) financing activities
Increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

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Equity Based Compensation (Details) (USD $)	6 Months Ended
	Jun. 30, 2011
Weighted-average fair value of options granted and assumptions
Fair value of options on grant date	$ 4.94
Expected life (years)	6 years
Risk-free interest rate	2.30%
Expected dividend yield
Expected volatility	76.20%

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Equity Based Compensation (Details 1) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Summary of option activity for stock options
Outstanding at January 1, 2012, Shares	796,500
Granted, Shares	0
Exercised, Shares	(34,000)
Outstanding at June 30, 2012, Shares	762,500	796,500
Exercisable on June 30, 2012, Shares	569,161
Expected to vest June 30, 2012, Shares	183,672
Outstanding at January 1, 2012, Weighted Average Exercise Price	$ 12.20
Granted, Weighted Average Exercise Price
Exercised, Weighted Average Exercise Price	$ 8.69
Forfeited, Weighted Average Exercise Price
Outstanding at June 30, 2012, Weighted Average Exercise Price	$ 12.35	$ 12.20
Exercisable on June 30, 2012, Weighted Average Exercise Price	$ 13.74
Expected to vest June 30, 2012, Weighted Average Exercise Price	$ 8.28
Outstanding, Weighted Average Remaining Contractual Life (Yrs.)	6 years 3 months 22 days	6 years 11 months 5 days
Exercisable on June 30, 2012, Weighted Average Remaining Contractual Life (Yrs.)	5 years 8 months 9 days
Expected to vest June 30, 2012, Weighted Average Remaining Contractual Life (Yrs.)	8 years 1 month 21 days
Exercised, Aggregate Intrinsic Value	$ 198
Outstanding at June 30, 2012, Aggregate Intrinsic Value	3,522
Exercisable on June 30, 2012, Aggregate Intrinsic Value	2,547
Expected to vest June 30, 2012, Aggregate Intrinsic Value	$ 975

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Debt

6 Months Ended

Jun. 30, 2012

Debt [Abstract]

DEBT

NOTE 3—DEBT

Our debt consisted of the following on the dates indicated:

	June 30, 2012			December 31, 2011
Term loan	$	—		$	200,229
Senior secured notes		210,000			—
Revolving credit facility		—			—
Original issue discount		(488	)		(1,306	)
Total debt		209,512			198,923
Current maturities		—			(2,043	)
Total long-term debt	$	209,512		$	196,880

Senior Secured Notes

In April 2012, the Company issued $210,000 aggregate principal amount of 7.375% Senior Secured Notes due May 15, 2019 (the “Senior Secured Notes”). The proceeds were used to repay the Company’s $265,000 senior secured term loan that was due in January 2016 with a then outstanding balance of $198,700. The Company recorded a loss on extinguishment of debt of $4,961 during the three and six months ended June 30, 2012, for the write-off of unamortized debt issuance costs. Interest is payable on the Senior Secured Notes on May 15 and November 15 of each year, beginning on November 15, 2012.

The Senior Secured Notes are fully and unconditionally guaranteed by each of the Company’s existing subsidiaries and will be guaranteed by any future domestic wholly-owned restricted subsidiaries of the Company. Debt issuance costs and other transaction fees of $8,600 are included in prepaid expenses and other current assets and other non-current assets and amortized over the life of the debt as interest expense. The Senior Secured Notes are secured, subject to certain permitted liens, on a second priority basis by substantially all of the Company’s and the guarantors’ current and future property and assets (including the capital stock of the Company’s current subsidiaries), other than certain excluded assets.

At any time prior to May 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the Senior Secured Notes with the proceeds of certain equity offerings at a redemption price equal to 107.375% of the principal amount of the Senior Secured Notes, plus accrued and unpaid interest to, but excluding the redemption date; provided, however, that at least 65% of the aggregate principal amount of the Senior Secured Notes are outstanding immediately following the redemption. In addition, at any time prior to May 15, 2015, the Company may redeem all or a portion of the Senior Secured Notes by paying a “make-whole” premium calculated as described in the indenture governing the Senior Secured Notes (the “Indenture”).

At any time on or after May 15, 2015, the Company may redeem all or a portion of the Senior Secured Notes at redemption prices calculated based on a percentage of the principal amount of the Senior Secured Notes being redeemed, plus accrued and unpaid interest, if any, to the redemption date, depending on the date on which the Senior Secured Notes are redeemed. These percentages range from between 100.00% and 105.53%.

Following a change of control, as defined in the Indenture, the Company will be required to make an offer to repurchase all or any portion of the Senior Secured Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest to, but excluding, the date of repurchase.

Revolving Credit Facility

In April 2012, the Company also entered into a new $25,000 revolving credit facility (the “Credit Facility”) with an interest rate of LIBOR (subject to a 1.00% floor) plus a margin of 4.50%, or Base Rate (subject to a 2.00% floor) plus a margin of 3.50%, as the Company may elect. In addition, the Company is required to pay commitment fees on the unused portion of the Credit Facility at the rate of 0.50% per annum. The termination date of the Credit facility is April 27, 2016. The new $25,000 revolving credit facility replaced the prior $30,000 revolving credit facility that was scheduled to mature in January 2013.

The Credit Facility includes a sub-facility for the issuance of letters of credit totaling up to $10,000. The Company’s obligations under the Credit Facility are guaranteed by each of the Company’s existing and future direct and indirect wholly-owned domestic subsidiaries, and the obligations of the Company and such guarantors in respect of the Credit Facility are secured by first priority liens on substantially all of the Company’s and such subsidiaries’ current and future property and assets, other than certain excluded assets pursuant to the first lien guarantee and collateral agreement by and among the Company, such guarantors and Wells Fargo Bank, National Association, as collateral trustee. In addition, the Credit Facility contains provisions to accommodate the incurrence of up to $150,000 in future incremental borrowings. While the Credit Facility does not contain any commitment by the lenders to provide this incremental indebtedness, the Credit Facility describes how such debt (if provided by the Company’s existing or new lenders) would be subject to various financial and other covenant compliance requirements and conditions at the time the additional debt is incurred. There was no outstanding balance on the revolving credit facility at June 30, 2012.

The fair value of the Senior Secured Notes at June 30, 2012 and the senior secured term loan at December 31, 2011 is estimated based on quoted market prices as follows:

	As of June 30,		As of December 31,
	2012		2011
Carrying amount, net	$	210,000	$	198,923	(1)
Fair value	$	217,400	$	198,247

(1) Term loan is reflected net of unamortized discount of $1,306 at December 31, 2011.

Debt Covenants

The Indenture and the Credit Facility include covenants which, among other things, limit the Company’s ability, and its subsidiaries, to:

• incur additional indebtedness or guarantee obligations;

• issue certain preferred stock or redeemable stock;

• pay dividends up to certain specified limits, repurchase or make distributions in respect of the Company’s capital stock or make other restricted payments;

• make certain investments;

• sell, transfer or otherwise convey certain assets;

• create or incur liens or other encumbrances;

• prepay, redeem or repurchase subordinated debt prior to stated maturities;

• designate the Company’s subsidiaries as unrestricted subsidiaries;

• consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets;

• enter into a new or different line of business; and

• enter into certain transactions with the Company’s affiliates.

The restrictive covenants are subject to a number of important exceptions and qualifications set forth in the Indenture and the Credit Facility.

The Indenture provides for customary events of default. If any event of default occurs and is continuing, subject to certain exceptions, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding Senior Secured Notes may declare all the Senior Secured Notes to be due and payable immediately, together with any accrued and unpaid interest, if any, to the acceleration date. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization, such amounts with respect to the Senior Secured Notes will be due and payable immediately without any declaration or other act on the part of the trustee or the holders of the Senior Secured Notes.

The Credit Facility contains further limitations on the Company’s ability to incur additional indebtedness and liens. In addition, to the extent the Company incurs certain specified levels of additional indebtedness, further limitations under the Credit Facility will become applicable under covenants related to sales of assets, sale-leaseback transactions, investment transactions, and the payment of dividends and other restricted payments. If the Company draws on the Credit Facility, the Company will be required to maintain a first lien leverage ratio as defined (the “Leverage Ratio”) not more than 2.75 to 1.00. The Credit Facility also contains certain representations and warranties, other affirmative and negative covenants, and events of default customary for secured revolving credit facilities of this type.

The Company’s failure to comply with any of these covenants, including compliance with the Leverage Ratio, will be an event of default under the Credit Facility, in which case the administrative agent may, with the consent or at the request of lenders holding a majority of the commitments and outstanding loans, terminate the Credit Facility and declare all or any portion of the obligations under the Credit Facility due and payable. Other events of default under the Credit Facility include:

• the Company’s failure to pay principal on the loans when due and payable, or its failure to pay interest on the loans or to pay certain fees and expenses (subject to applicable grace periods);

• the occurrence of a change of control (as defined in the Credit Facility);

• a breach or default by the Company or its subsidiaries on the payment of principal of any other indebtedness in an aggregate amount greater than $10,000;

• breach of representations or warranties in any material respect;

• failure to perform other obligations under the Credit Facility and the security documents for the Credit Facility (subject to applicable cure periods); or

• certain bankruptcy or insolvency events.

In the event of a bankruptcy or insolvency event of default, the Credit Facility will automatically terminate, and all obligations thereunder will immediately become due and payable.

As of June 30, 2012, the Company was in compliance with all of the financial covenants in its Credit Facility.

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Equity Based Compensation (Details 2) (USD $)	6 Months Ended
	Jun. 30, 2012
Summary of activity for restricted stock grants
Non-vested at January 1, 2012, Shares	248,804
Granted, Shares	263,928
Vested, Shares	(65,808)
Forfeited, Shares	(6,000)
Non-vested at June 30, 2012, Shares	440,924
Non-vested at January 1, 2012, Weighted Average Grant Date Fair Value	$ 8.43
Granted, Weighted Average Grant Date Fair Value	$ 12.13
Vested, Weighted Average Grant Date Fair Value	$ 7.92
Forfeited, Weighted Average Grant Date Fair Value	$ 10.91
Non-vested at June 30, 2012, Weighted Average Grant Date Fair Value	$ 10.69

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Theatre Acquisitions (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Mar. 30, 2012
Theatre Acquisitions (Textual) [Abstract]
Date of assets acquisition	Mar. 30, 2012
Purchase price of assets acquired		$ 700

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 85,779	$ 13,616
Restricted cash	17	331
Accounts receivable	5,659	4,985
Inventories	2,945	2,955
Prepaid expenses and other current assets	9,969	9,410
Total current assets	104,369	31,297
Property and equipment:
Land	53,695	53,909
Buildings and building improvements	273,148	276,221
Leasehold improvements	121,607	123,547
Assets under capital leases	44,970	44,970
Equipment	214,664	212,457
Construction in progress	3,535	2,349
Total property and equipment	711,619	713,453
Accumulated depreciation and amortization	(364,059)	(357,518)
Property and equipment, net of accumulated depreciation	347,560	355,935
Goodwill	8,087	8,087
Intangible assets, net of accumulated amortization	1,115	1,169
Investments in unconsolidated affiliates	6,503	8,498
Other assets	21,824	17,870
Total assets	489,458	422,856
Current liabilities:
Accounts payable	22,649	29,583
Accrued expenses	34,156	31,136
Current maturities of long-term debt, capital leases and long-term financing obligations	2,122	3,959
Total current liabilities	58,927	64,678
Long-term liabilities:
Long-term debt, less current maturities	209,512	196,880
Capital leases and long-term financing obligations, less current maturities	113,720	114,608
Deferred revenue	33,567	34,009
Other	17,251	18,306
Total long-term liabilities	374,050	363,803
Commitments and contingencies (Note 7)
Stockholders' equity (deficit):
Preferred Stock, $1.00 par value per share: 1,000,000 shares authorized, no shares issued
Common Stock, $0.03 par value per share: 35,000,000 shares authorized, 18,233,847 shares issued and 17,776,617 shares outstanding at June 30, 2012, and 13,419,872 shares issued and 12,966,942 shares outstanding at December 31, 2011	539	401
Treasury stock, 457,230 and 452,930 shares at cost at June 30, 2012 and December 31, 2011, respectively	(11,740)	(11,683)
Paid-in capital	348,593	290,997
Accumulated deficit	(280,911)	(285,340)
Total stockholders' equity (deficit)	56,481	(5,625)
Total liabilities and stockholders' equity (deficit)	$ 489,458	$ 422,856

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Basis of Presentation and Significant Accounting Policies

6 Months Ended

Jun. 30, 2012

Basis of Presentation and Significant Accounting Policies [Abstract]

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

NOTE 1—BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Carmike Cinemas, Inc. (referred to as “we”, “us”, “our”, and the “Company”) has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”). This information reflects all adjustments which in the opinion of management are necessary for a fair presentation of the balance sheet as of June 30, 2012 and December 31, 2011, the results of operations for the three and six month periods ended June 30, 2012 and 2011 and cash flows for the six months ended June 30, 2012. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011. That report includes a summary of our critical accounting policies. There have been no material changes in our accounting policies during the first six months of 2012.

The consolidated financial statements include the accounts of the Company’s wholly owned subsidiaries. All intercompany transactions and balances have been eliminated.

Accounting Estimates

In the preparation of financial statements in conformity with GAAP, management must make certain estimates, judgments and assumptions. These estimates, judgments and assumptions are made when accounting for items and matters such as, but not limited to, depreciation, amortization, asset valuations, impairment assessments, lease classification, employee benefits, income taxes, reserves and other provisions and contingencies. These estimates are based on the information available when recorded. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are recognized in the period they are determined.

Discontinued Operations

The results of operations for theatres that have been disposed of or classified as held for sale are eliminated from the Company’s continuing operations and classified as discontinued operations for each period presented within the Company’s condensed consolidated statements of operations. Theatres are reported as discontinued operations when the Company no longer has continuing involvement in the theatre operations and the cash flows have been eliminated, which generally occurs when the Company no longer has operations in a given market. See Note 6 – Discontinued Operations.

Impairment of Long-Lived Assets

Long-lived assets are tested for recoverability whenever events or circumstances indicate that the assets’ carrying values may not be recoverable. The Company performs its impairment analysis at the individual theatre-level, the lowest level of independent, identifiable cash flow. Management reviews all available evidence when assessing long-lived assets for impairment, including negative trends in theatre-level cash flow, the impact of competition, the age of the theatre, and alternative uses of the assets. The Company’s evaluation of negative trends in theatre-level cash flow considers the seasonality of the business, with significant revenues and cash flow generated in the summer and year-end holiday season. Absent any unusual circumstances, management evaluates new theatres for potential impairment only after a theatre has been open and operational for a sufficient period of time to allow its operations to mature.

For those assets that are identified as potentially being impaired, if the undiscounted future cash flows from such assets are less than the carrying value, the Company recognizes a loss equal to the difference between the carrying value and the asset’s fair value. The fair value of the assets is primarily estimated using the discounted future cash flow of the assets with consideration of other valuation techniques and using assumptions consistent with those used by market participants. Significant judgment is involved in estimating cash flows and fair value; significant assumptions include attendance levels, admissions and concessions pricing, and the weighted-average cost of capital. Management’s estimates are based on historical and projected operating performance.

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to the short-term maturities of these assets and liabilities.

The fair value of the Senior Secured Notes and Credit Facility described in Note 3 – Debt is estimated based on quoted market prices at the date of measurement.

Comprehensive Income

The Company has no other comprehensive income items.

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Discontinued Operations (Details Textual)	3 Months Ended		6 Months Ended
	Jun. 30, 2012 Theatre	Jun. 30, 2011 Theatre	Jun. 30, 2012 Theatre	Jun. 30, 2011 Theatre
Discontinued Operations (Textual) [Abstract]
Number of theatres closed during the period	3	1	7	4
Number of theatres closed during the period as discontinued operations	1	1	4	4

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Discontinued Operations (Tables)

6 Months Ended

Jun. 30, 2012

Discontinued Operations [Abstract]

Summary of activity for discontinued operations

	Three Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	42		$	714
Operating loss before income taxes	$	(59	)	$	(91	)
Income tax benefit from discontinued operations		22			31
Gain on disposal, before income taxes		167			9
Income tax expense on disposal		(62	)		(3	)
Income (loss) from discontinued operations	$	68		$	(54	)
	Six Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	242		$	1,336
Operating loss before income taxes	$	(160	)	$	(385	)
Income tax benefit from discontinued operations		60			131
Gain on disposal, before income taxes		125			235
Income tax expense on disposal		(46	)		(80	)
Loss from discontinued operations	$	(21	)	$	(99	)

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Commitments and Contingencies (Details) (USD $)	6 Months Ended
	Jun. 30, 2011 Litigation	Jun. 30, 2012
Commitments and Contingencies (Textual) [Abstract]
Number of pending litigation or proceedings	0
Non-cancelable purchase commitments related to capital expenditures		$ 8,100

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Guarantor Subsidiaries (Tables)

6 Months Ended

Jun. 30, 2012

Guarantor Subsidiaries [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

	As of June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	72,966		$	12,813		$	—		$	85,779
Restricted cash		17			—			—			17
Accounts receivable		4,855			804			—			5,659
Inventories		719			2,226			—			2,945
Prepaid expenses and other assets		4,375			4,619			—			8,994
Total current assets		82,932			20,462			—			103,394
Property and equipment:
Land		12,716			40,979			—			53,695
Buildings and building improvements		46,923			226,225			—			273,148
Leasehold improvements		19,625			101,982			—			121,607
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,972			155,692			—			214,664
Construction in progress		1,535			2,000			—			3,535
Total property and equipment		148,446			563,173			—			711,619
Accumulated depreciation and amortization		(79,054	)		(285,005	)		—			(364,059	)
Property and equipment, net of accumulated depreciation		69,392			278,168			—			347,560
Intercompany receivables		104,155			—			(104,155	)		—
Investments in subsidiaries		90,268			—			(90,268	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,115			—			1,115
Investments in unconsolidated affiliates		5,546			957			—			6,503
Other assets		15,639			6,185			—			21,824
Total assets	$	367,932		$	314,974		$	(194,423	)	$	488,483
Liabilities and stockholders’ equity:
Current liabilities:
Accounts payable	$	19,784			2,865			—			22,649
Accrued expenses		14,837			18,344			—			33,181
Current maturities of long-term debt, capital leases and long-term financing obligations		398			1,724			—			2,122
Total current liabilities		35,019			22,933			—			57,952
Long-term liabilities:
Long-term debt, less current maturities		209,512			—			—			209,512
Capital leases and long-term financing obligations, less current maturities		28,058			85,662			—			113,720
Intercompany liabilities		—			104,155			(104,155	)		—
Deferred revenue		33,567			—			—			33,567
Other		5,295			11,956			—			17,251
Total long-term liabilities		276,432			201,773			(104,155	)		374,050
Stockholders’ equity:
Preferred stock		—			—			—			—
Common stock		539			1			(1	)		539
Treasury stock		(11,740	)		—			—			(11,740	)
Paid-in capital		348,593			237,800			(237,800	)		348,593
Accumulated deficit		(280,911	)		(147,533	)		147,533			(280,911	)
Total stockholders’ equity		56,481			90,268			(90,268	)		56,481
Total liabilities and stockholders’ equity	$	367,932		$	314,974		$	(194,423	)	$	488,483

CONDENSED CONSOLIDATING BALANCE SHEET

	As of December 31, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	3,623		$	9,993		$	—		$	13,616
Restricted cash		331			—			—			331
Accounts receivable		4,654			331			—			4,985
Inventories		722			2,233			—			2,955
Prepaid expenses and other assets		4,953			4,457			—			9,410
Total current assets		14,283			17,014			—			31,297
Property and equipment:
Land		12,716			41,193			—			53,909
Buildings and building improvements		46,676			229,545			—			276,221
Leasehold improvements		19,307			104,240			—			123,547
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,128			154,329			—			212,457
Construction in progress		159			2,190			—			2,349
Total property and equipment		145,661			567,792			—			713,453
Accumulated depreciation and amortization		(75,760	)		(281,758	)		—			(357,518	)
Property and equipment, net of accumulated depreciation		69,901			286,034			—			355,935
Intercompany receivables		123,071			—			(123,071	)		—
Investment in subsidiaries		82,985			—			(82,985	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,169			—			1,169
Investment in unconsolidated affiliates		8,498			—			—			8,498
Other		10,536			7,334			—			17,870
Total assets	$	309,274		$	319,638		$	(206,056	)	$	422,856
Liabilities and stockholders’ (deficit) equity:
Current liabilities:
Accounts payable	$	27,598		$	1,985		$	—		$	29,583
Accrued expenses		19,752			11,384			—			31,136
Current maturities of long-term debt, capital leases and long-term financing obligations		2,391			1,568			—			3,959
Total current liabilities		49,741			14,937			—			64,678
Long-term liabilities:
Long-term debt, less current maturities		196,880			—			—			196,880
Capital leases and long-term financing obligations, less current maturities		28,223			86,385			—			114,608
Intercompany liabilities		—			123,071			(123,071	)		—
Deferred revenue		34,009			—			—			34,009
Other		6,045			12,261			—			18,306
Total long-term liabilities		265,157			221,717			(123,071	)		363,803
Stockholders’ (deficit) equity:
Preferred Stock		—			—			—			—
Common Stock		401			1			(1	)		401
Treasury stock		(11,683	)		—			—			(11,683	)
Paid-in capital		290,997			237,800			(237,800	)		290,997
Accumulated deficit		(285,340	)		(154,816	)		154,816			(285,340	)
Total stockholders’ (deficit) equity		(5,625	)		82,985			(82,985	)		(5,625	)
Total liabilities and stockholders’ (deficit) equity	$	309,274		$	319,638		$	(206,056	)	$	422,856

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	14,254		$	72,682	$	—		$	86,936
Concessions and other		14,982			40,980		(6,607	)		49,355
Total operating revenues		29,236			113,662		(6,607	)		136,291
Operating costs and expenses:
Film exhibition costs		8,006			40,527		—			48,533
Concession costs		999			4,511		—			5,510
Other theatre operating costs		10,337			48,977		(6,607	)		52,707
General and administrative expenses		4,588			586		—			5,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		1,716			6,040		—			7,756
Impairment of long-lived assets		4			46		—			50
Total operating costs and expenses		26,143			100,687		(6,607	)		120,223
Operating income		3,093			12,975		—			16,068
Interest expense		2,363			6,248		—			8,611
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(3,912	)		—		3,912			—
(Loss) income before income tax and (loss) income from unconsolidated affiliates		(319	)		6,727		(3,912	)		2,496
Income tax (benefit) expense		(2,034	)		2,952		—			918
(Loss) income from unconsolidated affiliates		(518	)		70		—			(448	)
Income from continuing operations		1,197			3,845		(3,912	)		1,130
Income from discontinued operations		1			67		—			68
Net income	$	1,198		$	3,912	$	(3,912	)	$	1,198

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	14,131		$	70,549		$	—		$	84,680
Concessions and other		14,623			38,534			(6,363	)		46,794
Total operating revenues		28,754			109,083			(6,363	)		131,474
Operating costs and expenses:
Film exhibition costs		7,836			38,787			—			46,623
Concession costs		972			4,357			—			5,329
Other theatre operating costs		10,382			45,429			(6,363	)		49,448
General and administrative expenses		3,984			512			—			4,496
Severance agreement charges		845			—			—			845
Depreciation and amortization		1,691			6,183			—			7,874
Loss on sale of property and equipment		67			13			—			80
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		786			378			—			1,164
Total operating costs and expenses		27,313			95,659			(6,363	)		116,609
Operating income		1,441			13,424			—			14,865
Interest expense		2,738			5,893			—			8,631
Equity in earnings of subsidiaries		(7,493	)		—			7,493			—
Income before income tax and income from unconsolidated affiliates		6,196			7,531			(7,493	)		6,234
Income tax expense		794			—			—			794
Income from unconsolidated affiliates		405			92			—			497
Income from continuing operations		5,807			7,623			(7,493	)		5,937
Income (loss) from discontinued operations		76			(130	)		—			(54	)
Net income	$	5,883		$	7,493		$	(7,493	)	$	5,883

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	28,029		$	142,097	$	—		$	170,126
Concessions and other		29,804			79,988		(12,920	)		96,872
Total operating revenues		57,833			222,085		(12,920	)		266,998
Operating costs and expenses:
Film exhibition costs		15,238			76,802		—			92,040
Concession costs		2,014			9,088		—			11,102
Other theatre operating costs		21,530			96,644		(12,920	)		105,254
General and administrative expenses		9,016			1,158		—			10,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		3,425			12,117		—			15,542
Loss on sale of property and equipment		20			228		—			248
Impairment of long-lived assets		13			1,523		—			1,536
Total operating costs and expenses		51,749			197,560		(12,920	)		236,389
Operating income		6,084			24,525		—			30,609
Interest expense		4,882			11,992		—			16,874
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(7,306	)		—		7,306			—
Income before income tax and (loss) income from unconsolidated affiliates		3,547			12,533		(7,306	)		8,774
Income tax (benefit) expense		(2,109	)		5,441		—			3,332
(Loss) income from unconsolidated affiliates		(1,172	)		180		—			(992	)
Income from continuing operations		4,484			7,272		(7,306	)		4,450
(Loss) income from discontinued operations		(55	)		34		—			(21	)
Net income	$	4,429		$	7,306	$	(7,306	)	$	4,429

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	25,124		$	120,596		$	—		$	145,720
Concessions and other		26,298			66,434			(11,265	)		81,467
Total operating revenues		51,422			187,030			(11,265	)		227,187
Operating costs and expenses:
Film exhibition costs		13,656			65,043			—			78,699
Concession costs		1,716			7,479			—			9,195
Other theatre operating costs		20,408			89,318			(11,265	)		98,461
General and administrative expenses		8,169			1,060			—			9,229
Severance agreement charges		845			—			—			845
Depreciation and amortization		3,294			12,368			—			15,662
Loss (gain) on sale of property and equipment		67			(7	)		—			60
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		908			417			—			1,325
Total operating costs and expenses		49,813			175,678			(11,265	)		214,226
Operating income		1,609			11,352			—			12,961
Interest expense		5,976			11,808			—			17,784
Equity in loss of subsidiaries		519			—			(519	)		—
Loss before income tax and (loss) income from unconsolidated affiliates		(4,886	)		(456	)		519			(4,823	)
Income tax expense		7,289			—			—			7,289
(Loss) income from unconsolidated affiliates		(445	)		141			—			(304	)
Loss from continuing operations		(12,620	)		(315	)		519			(12,416	)
Income (loss) from discontinued operations		105			(204	)		—			(99	)
Net loss	$	(12,515	)	$	(519	)	$	519		$	(12,515	)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash (used in) provided by operating activities		(2,151	)		28,280			—		26,129
Cash flows from investing activities:
Purchases of property and equipment		(4,855	)		(5,771	)		—		(10,626	)
Purchase acquistion		—			(702	)		—		(702	)
Proceeds from sale of property and equipment		33			667			—		700
Other investing activities		314			—			—		314
Net cash used in investing activities		(4,508	)		(5,806	)		—		(10,314	)
Cash flows from financing activities:
Short-term borrowings		5,000			—			—		5,000
Repayments of short term borrowings		(5,000	)		—			—		(5,000	)
Issuance of long-term debt		209,500			—			—		209,500
Repayments of long-term debt		(200,229	)		—			—		(200,229	)
Debt issuance costs		(8,599	)		—			—		(8,599	)
Repayments of capital leases and long-term financing obligations		(162	)		(738	)		—		(900	)
Issuance of common stock		56,633			—			—		56,633
Purchase of treasury stock		(57	)		—			—		(57	)
Intercompany receivable/payable		18,916			(18,916	)		—		—
Net cash provided by (used in) financing activities		76,002			(19,654	)		—		56,348
Increase in cash and cash equivalents		69,343			2,820			—		72,163
Cash and cash equivalents at beginning of period		3,623			9,993			—		13,616
Cash and cash equivalents at end of period		72,966			12,813			—		85,779

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2011
	Carmike Cinemas, Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	24,870		$	16,534		$	—	$	41,404
Cash flows from investing activities:
Purchases of property and equipment		(2,293	)		(3,955	)		—		(6,248	)
Proceeds from sale of property and equipment		6			438			—		444
Other investing activities		279			—			—		279
Net cash used in investing activities		(2,008	)		(3,517	)				(5,525	)
Cash flows from financing activities:
Repayments of long-term debt		(26,279	)		(844	)		—		(27,123	)
Intercompany receivable/payable		13,711			(13,711	)		—		—
Other financing activities		(588	)		—			—		(588	)
Net cash used in financing activities		(13,156	)		(14,555	)		—		(27,711	)
Increase / (decrease) in cash and cash equivalents		9,706			(1,538	)		—		8,168
Cash and cash equivalents at beginning of period		3,418			9,648			—		13,066
Cash and cash equivalents at end of period	$	13,124		$	8,110		$	—	$	21,234

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Impairment of Long-Lived Assets

6 Months Ended

Jun. 30, 2012

Impairment of Long-Lived Assets [Abstract]

IMPAIRMENT OF LONG-LIVED ASSETS

NOTE 2—IMPAIRMENT OF LONG-LIVED ASSETS

For the three and six months ended June 30, 2012, impairment charges aggregated to $50 and $1,536, respectively. The impairment charges were primarily the result of the Company’s plan to replace an owned theatre prior to the end of its useful life and the continued deterioration of previously impaired theatres. The Company recorded impairment charges of $1,164 and $1,325 during the three and six months ended June 30, 2011 which were primarily the result of continued deterioration of previously impaired theatres and a decline in market value of a previously closed theatre.

The estimated aggregate fair value of the long-lived assets impaired during the three and six months ended June 30, 2012 was approximately $870 and $5,677, respectively. These fair value estimates are considered Level 3 estimates and were derived primarily from discounting estimated future cash flows and contracts to sell certain owned properties. Future cash flows for a particular theatre are based on historical cash flows for that theatre, after giving effect to future attendance fluctuations, and are projected through the remainder of its lease term or useful life. The Company projects future attendance fluctuations of (10%) to 10%. The risk-adjusted rate of return used to discount these cash flows ranges from 10% to 15%.

XML

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Condensed Consolidated Balance Sheets [Abstract]
Preferred Stock, par value	$ 1.00	$ 1.00
Preferred Stock, shares authorized	1,000,000	1,000,000
Preferred Stock, shares issued	0	0
Common Stock, par value	$ 0.03	$ 0.03
Common Stock, shares authorized	35,000,000	35,000,000
Common Stock, shares issued	18,233,847	13,419,872
Common Stock, shares outstanding	17,776,617	12,966,942
Treasury stock, shares	457,230	452,930

XML

Common Stock Offering

6 Months Ended

Jun. 30, 2012

Common Stock Offering [Abstract]

COMMON STOCK OFFERING

NOTE 12—COMMON STOCK OFFERING

On April 11, 2012, the Company issued 4.0 million shares of its common stock, at a price to the public of $13.00 per share through a registered public offering. The Company granted the underwriters an option to purchase up to an additional 600 thousand shares of the Company’s common stock to cover over-allotments, if any, which the underwriters could exercise within 30 days of the date of the final prospectus. The underwriters purchased the additional 600 thousand shares of common stock on April 11, 2012. The offering was made pursuant to the Company’s effective shelf registration statement previously filed with the Securities and Exchange Commission (“SEC”). The net proceeds from the transaction were approximately $56,300. The funds received from the issuance of the shares will be used for general corporate purposes, including working capital, repayment of debt, possible acquisitions and other capital expenditures.

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Jul. 25, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	CARMIKE CINEMAS INC
Entity Central Index Key	0000799088
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		17,776,617

XML

Guarantor Subsidiaries

6 Months Ended

Jun. 30, 2012

Guarantor Subsidiaries [Abstract]

GUARANTOR SUBSIDIARIES

NOTE 13—GUARANTOR SUBSIDIARIES

The Company’s Senior Secured Notes, the offering of which was registered under the Securities Act of 1933, as amended, are fully and unconditionally guaranteed, on a joint and several basis, by the following 100% directly or indirectly owned subsidiaries: Eastwynn Theatres, Inc., George G. Kerasotes Corporation, GKC Indiana Theatres, Inc., GKC Michigan Theatres, Inc., GKC Theatres, Inc., and Military Services, Inc. Therefore, the Company is providing the following condensed consolidating financial statement information as of June 30, 2012 and December 31, 2011 and for the three and six months ended June 30, 2012 and 2011 in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered:

CONDENSED CONSOLIDATING BALANCE SHEET

	As of June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	72,966		$	12,813		$	—		$	85,779
Restricted cash		17			—			—			17
Accounts receivable		4,855			804			—			5,659
Inventories		719			2,226			—			2,945
Prepaid expenses and other assets		4,375			4,619			—			8,994
Total current assets		82,932			20,462			—			103,394
Property and equipment:
Land		12,716			40,979			—			53,695
Buildings and building improvements		46,923			226,225			—			273,148
Leasehold improvements		19,625			101,982			—			121,607
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,972			155,692			—			214,664
Construction in progress		1,535			2,000			—			3,535
Total property and equipment		148,446			563,173			—			711,619
Accumulated depreciation and amortization		(79,054	)		(285,005	)		—			(364,059	)
Property and equipment, net of accumulated depreciation		69,392			278,168			—			347,560
Intercompany receivables		104,155			—			(104,155	)		—
Investments in subsidiaries		90,268			—			(90,268	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,115			—			1,115
Investments in unconsolidated affiliates		5,546			957			—			6,503
Other assets		15,639			6,185			—			21,824
Total assets	$	367,932		$	314,974		$	(194,423	)	$	488,483
Liabilities and stockholders’ equity:
Current liabilities:
Accounts payable	$	19,784			2,865			—			22,649
Accrued expenses		14,837			18,344			—			33,181
Current maturities of long-term debt, capital leases and long-term financing obligations		398			1,724			—			2,122
Total current liabilities		35,019			22,933			—			57,952
Long-term liabilities:
Long-term debt, less current maturities		209,512			—			—			209,512
Capital leases and long-term financing obligations, less current maturities		28,058			85,662			—			113,720
Intercompany liabilities		—			104,155			(104,155	)		—
Deferred revenue		33,567			—			—			33,567
Other		5,295			11,956			—			17,251
Total long-term liabilities		276,432			201,773			(104,155	)		374,050
Stockholders’ equity:
Preferred stock		—			—			—			—
Common stock		539			1			(1	)		539
Treasury stock		(11,740	)		—			—			(11,740	)
Paid-in capital		348,593			237,800			(237,800	)		348,593
Accumulated deficit		(280,911	)		(147,533	)		147,533			(280,911	)
Total stockholders’ equity		56,481			90,268			(90,268	)		56,481
Total liabilities and stockholders’ equity	$	367,932		$	314,974		$	(194,423	)	$	488,483

CONDENSED CONSOLIDATING BALANCE SHEET

	As of December 31, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	3,623		$	9,993		$	—		$	13,616
Restricted cash		331			—			—			331
Accounts receivable		4,654			331			—			4,985
Inventories		722			2,233			—			2,955
Prepaid expenses and other assets		4,953			4,457			—			9,410
Total current assets		14,283			17,014			—			31,297
Property and equipment:
Land		12,716			41,193			—			53,909
Buildings and building improvements		46,676			229,545			—			276,221
Leasehold improvements		19,307			104,240			—			123,547
Assets under capital leases		8,675			36,295			—			44,970
Equipment		58,128			154,329			—			212,457
Construction in progress		159			2,190			—			2,349
Total property and equipment		145,661			567,792			—			713,453
Accumulated depreciation and amortization		(75,760	)		(281,758	)		—			(357,518	)
Property and equipment, net of accumulated depreciation		69,901			286,034			—			355,935
Intercompany receivables		123,071			—			(123,071	)		—
Investment in subsidiaries		82,985			—			(82,985	)		—
Goodwill		—			8,087			—			8,087
Intangible assets, net of accumulated amortization		—			1,169			—			1,169
Investment in unconsolidated affiliates		8,498			—			—			8,498
Other		10,536			7,334			—			17,870
Total assets	$	309,274		$	319,638		$	(206,056	)	$	422,856
Liabilities and stockholders’ (deficit) equity:
Current liabilities:
Accounts payable	$	27,598		$	1,985		$	—		$	29,583
Accrued expenses		19,752			11,384			—			31,136
Current maturities of long-term debt, capital leases and long-term financing obligations		2,391			1,568			—			3,959
Total current liabilities		49,741			14,937			—			64,678
Long-term liabilities:
Long-term debt, less current maturities		196,880			—			—			196,880
Capital leases and long-term financing obligations, less current maturities		28,223			86,385			—			114,608
Intercompany liabilities		—			123,071			(123,071	)		—
Deferred revenue		34,009			—			—			34,009
Other		6,045			12,261			—			18,306
Total long-term liabilities		265,157			221,717			(123,071	)		363,803
Stockholders’ (deficit) equity:
Preferred Stock		—			—			—			—
Common Stock		401			1			(1	)		401
Treasury stock		(11,683	)		—			—			(11,683	)
Paid-in capital		290,997			237,800			(237,800	)		290,997
Accumulated deficit		(285,340	)		(154,816	)		154,816			(285,340	)
Total stockholders’ (deficit) equity		(5,625	)		82,985			(82,985	)		(5,625	)
Total liabilities and stockholders’ (deficit) equity	$	309,274		$	319,638		$	(206,056	)	$	422,856

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	14,254		$	72,682	$	—		$	86,936
Concessions and other		14,982			40,980		(6,607	)		49,355
Total operating revenues		29,236			113,662		(6,607	)		136,291
Operating costs and expenses:
Film exhibition costs		8,006			40,527		—			48,533
Concession costs		999			4,511		—			5,510
Other theatre operating costs		10,337			48,977		(6,607	)		52,707
General and administrative expenses		4,588			586		—			5,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		1,716			6,040		—			7,756
Impairment of long-lived assets		4			46		—			50
Total operating costs and expenses		26,143			100,687		(6,607	)		120,223
Operating income		3,093			12,975		—			16,068
Interest expense		2,363			6,248		—			8,611
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(3,912	)		—		3,912			—
(Loss) income before income tax and (loss) income from unconsolidated affiliates		(319	)		6,727		(3,912	)		2,496
Income tax (benefit) expense		(2,034	)		2,952		—			918
(Loss) income from unconsolidated affiliates		(518	)		70		—			(448	)
Income from continuing operations		1,197			3,845		(3,912	)		1,130
Income from discontinued operations		1			67		—			68
Net income	$	1,198		$	3,912	$	(3,912	)	$	1,198

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Three Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	14,131		$	70,549		$	—		$	84,680
Concessions and other		14,623			38,534			(6,363	)		46,794
Total operating revenues		28,754			109,083			(6,363	)		131,474
Operating costs and expenses:
Film exhibition costs		7,836			38,787			—			46,623
Concession costs		972			4,357			—			5,329
Other theatre operating costs		10,382			45,429			(6,363	)		49,448
General and administrative expenses		3,984			512			—			4,496
Severance agreement charges		845			—			—			845
Depreciation and amortization		1,691			6,183			—			7,874
Loss on sale of property and equipment		67			13			—			80
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		786			378			—			1,164
Total operating costs and expenses		27,313			95,659			(6,363	)		116,609
Operating income		1,441			13,424			—			14,865
Interest expense		2,738			5,893			—			8,631
Equity in earnings of subsidiaries		(7,493	)		—			7,493			—
Income before income tax and income from unconsolidated affiliates		6,196			7,531			(7,493	)		6,234
Income tax expense		794			—			—			794
Income from unconsolidated affiliates		405			92			—			497
Income from continuing operations		5,807			7,623			(7,493	)		5,937
Income (loss) from discontinued operations		76			(130	)		—			(54	)
Net income	$	5,883		$	7,493		$	(7,493	)	$	5,883

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries		Eliminations			Consolidated
Revenues:
Admissions	$	28,029		$	142,097	$	—		$	170,126
Concessions and other		29,804			79,988		(12,920	)		96,872
Total operating revenues		57,833			222,085		(12,920	)		266,998
Operating costs and expenses:
Film exhibition costs		15,238			76,802		—			92,040
Concession costs		2,014			9,088		—			11,102
Other theatre operating costs		21,530			96,644		(12,920	)		105,254
General and administrative expenses		9,016			1,158		—			10,174
Severance agreement charges		493			—		—			493
Depreciation and amortization		3,425			12,117		—			15,542
Loss on sale of property and equipment		20			228		—			248
Impairment of long-lived assets		13			1,523		—			1,536
Total operating costs and expenses		51,749			197,560		(12,920	)		236,389
Operating income		6,084			24,525		—			30,609
Interest expense		4,882			11,992		—			16,874
Loss on extinguishment of debt		4,961			—		—			4,961
Equity in earnings of subsidiaries		(7,306	)		—		7,306			—
Income before income tax and (loss) income from unconsolidated affiliates		3,547			12,533		(7,306	)		8,774
Income tax (benefit) expense		(2,109	)		5,441		—			3,332
(Loss) income from unconsolidated affiliates		(1,172	)		180		—			(992	)
Income from continuing operations		4,484			7,272		(7,306	)		4,450
(Loss) income from discontinued operations		(55	)		34		—			(21	)
Net income	$	4,429		$	7,306	$	(7,306	)	$	4,429

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

	Six Months Ended June 30, 2011
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Admissions	$	25,124		$	120,596		$	—		$	145,720
Concessions and other		26,298			66,434			(11,265	)		81,467
Total operating revenues		51,422			187,030			(11,265	)		227,187
Operating costs and expenses:
Film exhibition costs		13,656			65,043			—			78,699
Concession costs		1,716			7,479			—			9,195
Other theatre operating costs		20,408			89,318			(11,265	)		98,461
General and administrative expenses		8,169			1,060			—			9,229
Severance agreement charges		845			—			—			845
Depreciation and amortization		3,294			12,368			—			15,662
Loss (gain) on sale of property and equipment		67			(7	)		—			60
Write-off of note receivable		750			—			—			750
Impairment of long-lived assets		908			417			—			1,325
Total operating costs and expenses		49,813			175,678			(11,265	)		214,226
Operating income		1,609			11,352			—			12,961
Interest expense		5,976			11,808			—			17,784
Equity in loss of subsidiaries		519			—			(519	)		—
Loss before income tax and (loss) income from unconsolidated affiliates		(4,886	)		(456	)		519			(4,823	)
Income tax expense		7,289			—			—			7,289
(Loss) income from unconsolidated affiliates		(445	)		141			—			(304	)
Loss from continuing operations		(12,620	)		(315	)		519			(12,416	)
Income (loss) from discontinued operations		105			(204	)		—			(99	)
Net loss	$	(12,515	)	$	(519	)	$	519		$	(12,515	)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2012
	Carmike Cinemas,  Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash (used in) provided by operating activities		(2,151	)		28,280			—		26,129
Cash flows from investing activities:
Purchases of property and equipment		(4,855	)		(5,771	)		—		(10,626	)
Purchase acquistion		—			(702	)		—		(702	)
Proceeds from sale of property and equipment		33			667			—		700
Other investing activities		314			—			—		314
Net cash used in investing activities		(4,508	)		(5,806	)		—		(10,314	)
Cash flows from financing activities:
Short-term borrowings		5,000			—			—		5,000
Repayments of short term borrowings		(5,000	)		—			—		(5,000	)
Issuance of long-term debt		209,500			—			—		209,500
Repayments of long-term debt		(200,229	)		—			—		(200,229	)
Debt issuance costs		(8,599	)		—			—		(8,599	)
Repayments of capital leases and long-term financing obligations		(162	)		(738	)		—		(900	)
Issuance of common stock		56,633			—			—		56,633
Purchase of treasury stock		(57	)		—			—		(57	)
Intercompany receivable/payable		18,916			(18,916	)		—		—
Net cash provided by (used in) financing activities		76,002			(19,654	)		—		56,348
Increase in cash and cash equivalents		69,343			2,820			—		72,163
Cash and cash equivalents at beginning of period		3,623			9,993			—		13,616
Cash and cash equivalents at end of period		72,966			12,813			—		85,779

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

	For the Six Months Ended June 30, 2011
	Carmike Cinemas, Inc.			Guarantor Subsidiaries			Eliminations		Consolidated
Net cash provided by operating activities	$	24,870		$	16,534		$	—	$	41,404
Cash flows from investing activities:
Purchases of property and equipment		(2,293	)		(3,955	)		—		(6,248	)
Proceeds from sale of property and equipment		6			438			—		444
Other investing activities		279			—			—		279
Net cash used in investing activities		(2,008	)		(3,517	)				(5,525	)
Cash flows from financing activities:
Repayments of long-term debt		(26,279	)		(844	)		—		(27,123	)
Intercompany receivable/payable		13,711			(13,711	)		—		—
Other financing activities		(588	)		—			—		(588	)
Net cash used in financing activities		(13,156	)		(14,555	)		—		(27,711	)
Increase / (decrease) in cash and cash equivalents		9,706			(1,538	)		—		8,168
Cash and cash equivalents at beginning of period		3,418			9,648			—		13,066
Cash and cash equivalents at end of period	$	13,124		$	8,110		$	—	$	21,234

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Condensed Consolidated Statements of Operations (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Revenues:
Admissions	$ 86,936	$ 84,680	$ 170,126	$ 145,720
Concessions and other	49,355	46,794	96,872	81,467
Total operating revenues	136,291	131,474	266,998	227,187
Operating costs and expenses:
Film exhibition costs	48,533	46,623	92,040	78,699
Concession costs	5,510	5,329	11,102	9,195
Other theatre operating costs	52,707	49,448	105,254	98,461
General and administrative expenses	5,174	4,496	10,174	9,229
Severance agreement charges	493	845	493	845
Depreciation and amortization	7,756	7,874	15,542	15,662
Loss on sale of property and equipment		80	248	60
Write-off of note receivable		750		750
Impairment of long-lived assets	50	1,164	1,536	1,325
Total operating costs and expenses	120,223	116,609	236,389	214,226
Operating income	16,068	14,865	30,609	12,961
Interest expense	8,611	8,631	16,874	17,784
Loss on extinguishment of debt	4,961		4,961
Income (loss) before income tax and (loss) income from unconsolidated affiliates	2,496	6,234	8,774	(4,823)
Income tax expense (Note 4)	918	794	3,332	7,289
(Loss) income from unconsolidated affiliates	(448)	497	(992)	(304)
Income (loss) from continuing operations	1,130	5,937	4,450	(12,416)
Income (loss) from discontinued operations (Note 6)	68	(54)	(21)	(99)
Net income (loss)	$ 1,198	$ 5,883	$ 4,429	$ (12,515)
Weighted average shares outstanding:
Basic	16,963	12,796	14,894	12,790
Diluted	17,364	12,827	15,147	12,790
Net income (loss) per common share (Basic):
Income (loss) from continuing operations	$ 0.07	$ 0.46	$ 0.30	$ (0.97)
Loss from discontinued operations, net of tax				$ (0.01)
Net income (loss)	$ 0.07	$ 0.46	$ 0.30	$ (0.98)
Net income (loss) per common share (Diluted):
Income (loss) from continuing operations	$ 0.07	$ 0.46	$ 0.29	$ (0.97)
Loss from discontinued operations, net of tax				$ (0.01)
Net income (loss)	$ 0.07	$ 0.46	$ 0.29	$ (0.98)

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 7—COMMITMENTS AND CONTINGENCIES

Commitments

As of June 30, 2012, the Company had non-cancelable purchase commitments related to capital expenditures totaling $8,100.

Contingencies

The Company, in the normal course of business, is involved in routine litigation and legal proceedings, such as personal injury claims, employment matters, contractual disputes and claims alleging Americans with Disabilities Act violations. Currently, there is no pending litigation or proceedings that the Company believes will have a material adverse effect, either individually or in the aggregate, on its business or its financial position, results of operations or cash flow.

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Discontinued Operations

6 Months Ended

Jun. 30, 2012

Discontinued Operations [Abstract]

DISCONTINUED OPERATIONS

NOTE 6—DISCONTINUED OPERATIONS

Theatres are generally considered for closure due to an expiring lease, underperformance, or the opportunity to better deploy invested capital. During the three months ended June 30, 2012 and 2011, the Company closed three theatres and one theatre, respectively, and for the six months ended June 30, 2012 and 2011, the Company closed seven and four theatres, respectively. With respect to the closures during the three months ended June 30, 2012 and 2011, the Company classified one theatre in each period as discontinued operations and for the six months ended June 30, 2012 and 2011, the Company classified four theatres in each period as discontinued operations. The Company reported the results of these operations, including gains and losses on disposal, as discontinued operations. The operations and cash flows of these theatres have been eliminated from the Company’s operations, and the Company will not have any continuing involvement in their operations.

All activity during the three and six months ended June 30, 2012 included in the accompanying consolidated statements of operations has been reclassified to separately reflect the results of operations from theatres closed in 2012 and considered discontinued operations through the respective date of the theatre closings. Assets and liabilities associated with the discontinued operations have not been segregated from assets and liabilities from continuing operations as they are not material.

The following table sets forth the summary of activity for discontinued operations for the three and six months ended June 30, 2012 and 2011:

	Three Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	42		$	714
Operating loss before income taxes	$	(59	)	$	(91	)
Income tax benefit from discontinued operations		22			31
Gain on disposal, before income taxes		167			9
Income tax expense on disposal		(62	)		(3	)
Income (loss) from discontinued operations	$	68		$	(54	)
	Six Months Ended June 30,
	2012			2011
Revenue from discontinued operations	$	242		$	1,336
Operating loss before income taxes	$	(160	)	$	(385	)
Income tax benefit from discontinued operations		60			131
Gain on disposal, before income taxes		125			235
Income tax expense on disposal		(46	)		(80	)
Loss from discontinued operations	$	(21	)	$	(99	)

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Investments in Unconsolidated Affiliates (Tables)

6 Months Ended

Jun. 30, 2012

Investments in Unconsolidated Affiliates [Abstract]

Combined financial information of the unconsolidated affiliated companies

	As of June 30,
	2012
Assets:
Current assets	$	40,349
Noncurrent assets		163,743
Total assets	$	204,092
Liabilties:
Current liabilities	$	40,792
Noncurrent liabilities		86,424
Total liabilities	$	127,216

	Three Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	31,403		$	45,934
Net loss	$	(5,328	)	$	6
	Six Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	54,187		$	68,942
Net loss	$	(13,697	)	$	(7,735	)

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Basis of Presentation and Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2012

Basis of Presentation and Significant Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

Carmike Cinemas, Inc. (referred to as “we”, “us”, “our”, and the “Company”) has prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”). This information reflects all adjustments which in the opinion of management are necessary for a fair presentation of the balance sheet as of June 30, 2012 and December 31, 2011, the results of operations for the three and six month periods ended June 30, 2012 and 2011 and cash flows for the six months ended June 30, 2012. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. The Company believes that the disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011. That report includes a summary of our critical accounting policies. There have been no material changes in our accounting policies during the first six months of 2012.

The consolidated financial statements include the accounts of the Company’s wholly owned subsidiaries. All intercompany transactions and balances have been eliminated.

Accounting Estimates

Accounting Estimates

In the preparation of financial statements in conformity with GAAP, management must make certain estimates, judgments and assumptions. These estimates, judgments and assumptions are made when accounting for items and matters such as, but not limited to, depreciation, amortization, asset valuations, impairment assessments, lease classification, employee benefits, income taxes, reserves and other provisions and contingencies. These estimates are based on the information available when recorded. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are recognized in the period they are determined.

Discontinued Operations

Discontinued Operations

The results of operations for theatres that have been disposed of or classified as held for sale are eliminated from the Company’s continuing operations and classified as discontinued operations for each period presented within the Company’s condensed consolidated statements of operations. Theatres are reported as discontinued operations when the Company no longer has continuing involvement in the theatre operations and the cash flows have been eliminated, which generally occurs when the Company no longer has operations in a given market. See Note 6 – Discontinued Operations.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

Long-lived assets are tested for recoverability whenever events or circumstances indicate that the assets’ carrying values may not be recoverable. The Company performs its impairment analysis at the individual theatre-level, the lowest level of independent, identifiable cash flow. Management reviews all available evidence when assessing long-lived assets for impairment, including negative trends in theatre-level cash flow, the impact of competition, the age of the theatre, and alternative uses of the assets. The Company’s evaluation of negative trends in theatre-level cash flow considers the seasonality of the business, with significant revenues and cash flow generated in the summer and year-end holiday season. Absent any unusual circumstances, management evaluates new theatres for potential impairment only after a theatre has been open and operational for a sufficient period of time to allow its operations to mature.

For those assets that are identified as potentially being impaired, if the undiscounted future cash flows from such assets are less than the carrying value, the Company recognizes a loss equal to the difference between the carrying value and the asset’s fair value. The fair value of the assets is primarily estimated using the discounted future cash flow of the assets with consideration of other valuation techniques and using assumptions consistent with those used by market participants. Significant judgment is involved in estimating cash flows and fair value; significant assumptions include attendance levels, admissions and concessions pricing, and the weighted-average cost of capital. Management’s estimates are based on historical and projected operating performance.

Fair Value Measurements

Fair Value Measurements

The carrying values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to the short-term maturities of these assets and liabilities.

The fair value of the Senior Secured Notes and Credit Facility described in Note 3 – Debt is estimated based on quoted market prices at the date of measurement.

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Investments in Unconsolidated Affiliates

6 Months Ended

Jun. 30, 2012

Investments in Unconsolidated Affiliates [Abstract]

INVESTMENTS IN UNCONSOLIDATED AFFILIATES

NOTE 10—INVESTMENTS IN UNCONSOLIDATED AFFILIATES

Our investments in affiliated companies accounted for by the equity method consist of our ownership interest in Screenvision, as discussed in Note 9 – Screenvision Exhibition, Inc., and interests in other joint ventures.

Combined financial information of the unconsolidated affiliated companies accounted for by the equity method is as follows:

	As of June 30,
	2012
Assets:
Current assets	$	40,349
Noncurrent assets		163,743
Total assets	$	204,092
Liabilties:
Current liabilities	$	40,792
Noncurrent liabilities		86,424
Total liabilities	$	127,216

	Three Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	31,403		$	45,934
Net loss	$	(5,328	)	$	6
	Six Months Ended
	June 30, 2012			June 30, 2011
Results of operations:
Revenue	$	54,187		$	68,942
Net loss	$	(13,697	)	$	(7,735	)

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Net Income (Loss) Per Share

6 Months Ended

Jun. 30, 2012

Net Income (Loss) Per Share [Abstract]

NET INCOME (LOSS) PER SHARE

NOTE 8—NET INCOME (LOSS) PER SHARE

Basic net income (loss) per common share has been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted income (loss) per share is computed using the weighted-average number of common shares and common stock equivalents outstanding. Common stock equivalents totaling 400,337 and 1,004,577, for the three months ended June 30, 2012 and 2011, respectively, and common stock equivalents totaling 253,599 for the six months ended June 30, 2012 were excluded from the calculation of diluted earnings per share because of a decline in the average market price of the common stock below the exercise price. As a result of the Company’s net losses, all common stock equivalents aggregating 1,180,908 for the six months ended June 30, 2011 were excluded from the calculation of diluted loss per share given their anti-dilutive effect.

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Screenvision Exhibition, Inc.

6 Months Ended

Jun. 30, 2012

Screenvision Exhibition, Inc. [Abstract]

SCREENVISION EXHIBITION, INC.

NOTE 9—SCREENVISION EXHIBITION, INC.

On October 14, 2010, the Company finalized the modification of its long-term exhibition agreement (the “Modified Exhibition Agreement”) with Screenvision Exhibition, Inc. (“Screenvision”), the Company’s exclusive provider of on-screen advertising services. The Modified Exhibition Agreement extends the Company’s exhibition agreement with Screenvision, which was set to expire on July 1, 2012, for an additional 30 year term through July 1, 2042 (“Expiration Date”).

In connection with the Modified Exhibition Agreement, the Company received a cash payment of $30,000 from Screenvision in January 2011. In addition, on October 14, 2010, the Company received, for no additional consideration, Class C membership units representing, as of that date, approximately 20% of the issued and outstanding membership units of SV Holdco, LLC (“SV Holdco”). SV Holdco is a holding company that owns and operates the Screenvision business through a subsidiary entity. SV Holdco has elected to be taxed as a partnership for U.S. federal income tax purposes.

In September 2011, the Company made a voluntary capital contribution of $718 to SV Holdco. The capital contribution was made to maintain the Company’s relative ownership interest following an acquisition by Screenvision and additional capital contributions by other owners of SV Holdco. The Company received Class A membership units representing less than 1% of the issued and outstanding membership units of SV Holdco in return for the Company’s capital contribution.

As of June 30, 2012, the Company held Class C and Class A membership units representing approximately 19% of the total issued and outstanding membership units of SV Holdco. As of June 30, 2012, the carrying value of the Company’s ownership interest in SV Holdco is $5,546 and is included in investments in unconsolidated affiliates in the consolidated balance sheets and, for book purposes, is accounted for as an equity method investment.

The Company’s Class C membership units are intended to be treated as a “profits interest” in SV Holdco for U.S. federal income tax purposes and thus do not give the Company an interest in the other members’ initial or subsequent capital contributions. As a profits interest, the Company’s Class C membership units are designed to represent an equity interest in SV Holdco’s future profits and appreciation in assets beyond a defined threshold amount, which equaled $85,000 as of October 14, 2010. The $85,000 threshold amount represented the agreed upon value of initial capital contributions made by the members to SV Holdco and is subject to adjustment to account for future capital contributions made to SV Holdco. Accordingly, the threshold amount applicable to the Company’s Class C membership units has increased to $88,000 as of June 30, 2012.

The Company will also receive additional Class C membership units (“bonus units”), all of which will be subject to forfeiture, or may forfeit some of its initial Class C membership units, based upon changes in the Company’s future theatre and screen count. However, the Company will not forfeit more than 25% of the Class C membership units it received in October 2010, and the Company will not receive bonus units in excess of 33% of the Class C membership units it received in October 2010. Any bonus units and the initial Class C membership units subject to forfeiture will each become non-forfeitable on the Expiration Date, or upon the earlier occurrence of certain events, including (1) a change of control or liquidation of SV Holdco or (2) the consummation of an initial public offering of securities of SV Holdco. As a result, bonus units and forfeitable units will not be reflected in the Company’s consolidated financial statements until such units become non-forfeitable. The non-forfeitable ownership interest in SV Holdco was recorded at an estimated fair value of $6,555 which was determined using the Black Scholes Model. The Company has applied the equity method of accounting for the non-forfeitable units and for financial reporting purposes began recording the related percentage of the earnings or losses of SV Holdco in its consolidated statement of operations since October 14, 2010. The Company’s non-forfeitable Class C and Class A membership units represented approximately 15% of the total issued and outstanding membership units of SV Holdco as of June 30, 2012.

For financial reporting purposes, the gains from both the $30,000 cash payment to the Company and its non-forfeitable membership units in SV Holdco ($36,555 in the aggregate) have been deferred and will be recognized as concessions and other revenue on a straight line basis over the remaining term of the Modified Exhibition Agreement. The Company has included in concessions and other revenue in the consolidated statement of operations amounts related to Screenvision of approximately $2,100 and $4,400 for the three and six months ended June 30, 2012 and approximately $2,500 and $4,300 for the three and six months ended June 30, 2011, respectively. The Company reclassifies certain amounts from Screenvision included in concessions and other revenue to earnings from unconsolidated affiliates. The amount reclassified is based on the Company’s non-forfeitable ownership percentage of SV Holdco membership units, represents an intercompany gain to the Company and totaled approximately $400 for the three months ended June 30, 2012 and 2011 and approximately $800, for the six months ended June 30, 2012 and 2011. The Company has included in accounts receivable in the consolidated balance sheets amounts due from Screenvision of $1,874 and $1,860 at June 30, 2012 and December 31, 2011, respectively.

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Theatre Acquisitions

6 Months Ended

Jun. 30, 2012

Theatre Acquisitions [Abstract]

THEATRE ACQUISITIONS

NOTE 11—THEATRE ACQUISITIONS

On March 30, 2012, the Company completed its purchase of certain assets from Destinta Theatres for approximately $700. The acquisition consisted of a seven screen theatre in Clarion, Pennsylvania. The Company has accounted for this transaction as an asset acquisition. The purchase price was allocated to the assets acquired, primarily leasehold improvements, based on their respective fair values.

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Discontinued Operations (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Summary of activity for discontinued operations
Revenue from discontinued operations	$ 42	$ 714	$ 242	$ 1,336
Operating loss before income taxes	(59)	(91)	(160)	(385)
Income tax benefit from discontinued operations	22	31	60	131
Gain on disposal, before income taxes	167	9	125	235
Income tax expense on disposal	(62)	(3)	(46)	(80)
Income (loss) from discontinued operations	$ 68	$ (54)	$ (21)	$ (99)

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Equity Based Compensation (Tables)

6 Months Ended

Jun. 30, 2012

Equity Based Compensation [Abstract]

Weighted-average fair value of options granted and assumptions

	2011
Fair value of options on grant date	$	4.94
Expected life (years)		6.0
Risk-free interest rate		2.3	%
Expected dividend yield		—	%
Expected volatility		76.2	%

Summary of option activity for stock options

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Yrs.)		Aggregate Intrinsic Value
Outstanding at January 1, 2012		796,500		$	12.20		6.93
Granted		—		$	—
Exercised		(34,000	)	$	8.69			$	198
Forfeited		—		$	—
Outstanding at June 30, 2012		762,500		$	12.35		6.31	$	3,522
Exercisable on June 30, 2012		569,161		$	13.74		5.69	$	2,547
Expected to vest June 30, 2012		183,672		$	8.28		8.14	$	975

Summary of activity for restricted stock grants

	Shares			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2012		248,804		$	8.43
Granted		263,928		$	12.13
Vested		(65,808	)	$	7.92
Forfeited		(6,000	)	$	10.91
Nonvested at June 30, 2012		440,924		$	10.69

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Debt (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Components of debt
Term loan	$ 210,000	$ 198,923
Original issue discount	(488)	(1,306)
Current maturities		2,043
Total long-term debt	209,512	196,880
Term loan [Member]
Components of debt
Term loan		200,229
Senior secured notes [Member]
Components of debt
Term loan	210,000
Revolving credit facility [Member]
Components of debt
Term loan

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Common Stock Offering (Details) (USD $) In Thousands, except Share data, unless otherwise specified	0 Months Ended	6 Months Ended
	Apr. 11, 2012	Jun. 30, 2012
Common Stock Offering (Textual) [Abstract]
Shares of common stock issued	4,000,000
Common stock issued, price per share	$ 13.00
Additional shares of common stock purchased by underwriters	600,000
Common stock exercise period for underwriters	30 days
Net proceeds from issuance of common stock	$ 56,300	$ 56,633
Additional options granted to underwriters to cover over-allotments	600

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Cash flows from operating activities:
Net income (loss)	$ 4,429	$ (12,515)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	15,571	15,768
Amortization of debt issuance costs	1,035	1,959
Impairment on long-lived assets	1,536	1,325
Loss on extinguishment of debt	4,961
Stock-based compensation	1,101	1,188
Loss from unconsolidated affiliates	992	304
Other	205	318
Write-off of note receivable		750
Loss (gain) on sale of property and equipment	124	(173)
Distributions from unconsolidated affiliates	206	205
Changes in operating assets and liabilities:
Accounts receivable and inventories	(737)	(1,530)
Screenvision receivable		30,000
Prepaid expenses and other assets	209	(246)
Accounts payable	(5,761)	759
Accrued expenses and other liabilities	2,258	3,292
Net cash provided by operating activities	26,129	41,404
Cash flows from investing activities:
Purchases of property and equipment	(10,626)	(6,248)
Release of restricted cash	314	279
Theatre acquisition	(702)
Proceeds from sale of property and equipment	700	444
Net cash used in investing activities	(10,314)	(5,525)
Debt activities:
Short-term borrowings	5,000
Repayment of short-term borrowings	(5,000)
Issuance of long-term debt	209,500
Repayments of long-term debt	(200,229)	(26,161)
Debt issuance costs	(8,599)	(588)
Repayments of capital lease and long-term financing obligations	(900)	(962)
Issuance of common stock	56,633
Purchase of treasury stock	(57)
Net cash provided by (used in) financing activities	56,348	(27,711)
Increase in cash and cash equivalents	72,163	8,168
Cash and cash equivalents at beginning of period	13,616	13,066
Cash and cash equivalents at end of period	85,779	21,234
Cash paid during the period for:
Interest	12,913	16,631
Income taxes	2,789	6,122
Non-cash investing and financing activities:
Non-cash purchase of property and equipment	$ 516	$ 2,865

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Equity Based Compensation

6 Months Ended

Jun. 30, 2012

Equity Based Compensation [Abstract]

EQUITY BASED COMPENSATION

NOTE 5—EQUITY BASED COMPENSATION

In March 2004, the Board of Directors adopted the Carmike Cinemas, Inc. 2004 Incentive Stock Plan (the “2004 Incentive Stock Plan”). The Company’s Compensation and Nominating Committee (or similar committee) may grant stock options, stock grants, stock units, and stock appreciation rights under the 2004 Incentive Stock Plan to certain eligible employees and to outside directors. As of June 30, 2012, there were 1,309,684 shares available for future grants under the 2004 Incentive Stock Plan. The Company’s policy is to issue new shares upon exercise of options and the issuance of stock grants.

The Company also issues restricted stock awards to certain key employees and directors. Generally, the restricted stock vests over a one to three year period and compensation expense is recognized over the one to three year period equal to the grant date fair value of the shares awarded. As of June 30, 2012, the Company also had 240,083 shares of performance-based awards outstanding which are dependent on the achievement of EBITDA targets that vest over a three-year period. As of June 30, 2012, 96,083 shares of these performance-based stock awards have been earned due to the achievement of EBITDA targets. Performance-based stock awards are recognized as compensation expense over the vesting period based on the fair value on the date of grant and the number of shares ultimately expected to vest. The Company has determined the achievement of the performance target for the unearned awards is probable.

The Company’s total stock-based compensation expense was approximately $638 and $724 for the three months ended June 30, 2012 and 2011, respectively, and $1,101 and $1,188 for the six months ended June 30, 2012 and 2011, respectively. Included in stock-based compensation expense for the three and six months ended June 30, 2012, is $115 related to the accelerated vesting of stock-based awards to the Company’s former Vice President-General Manager Theatre Operations. Included in stock-based compensation expense for the three and six months ended June 30, 2011, is $222 related to the accelerated vesting of stock-based awards to the Company’s former Senior Vice President-General Counsel and Secretary. Stock-based compensation expense is included in general and administrative expenses in the consolidated statement of operations with the exception of the accelerated vested awards which are included in Severance Agreement Charges. As of June 30, 2012, the Company had approximately $4,070 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Company’s plans. This cost is expected to be recognized as stock-based compensation expense over a weighted-average period of approximately 2.2 years. This expected cost does not include the impact of any future stock-based compensation awards.

Options – Service Condition Vesting

The Company currently uses the Black-Scholes option pricing model to determine the fair value of its stock options for which vesting is dependent only on employees providing future service.

No options were granted during the first six months of 2012. The following table sets forth information about the weighted-average fair value of options granted and the weighted-average assumptions for such options granted during the first six months of 2011:

	2011
Fair value of options on grant date	$	4.94
Expected life (years)		6.0
Risk-free interest rate		2.3	%
Expected dividend yield		—	%
Expected volatility		76.2	%

The Company’s stock-based compensation expense is recorded based on an estimated forfeiture rate of 5%.

The following table sets forth the summary of option activity for stock options with service vesting conditions as of June 30, 2012:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Yrs.)		Aggregate Intrinsic Value
Outstanding at January 1, 2012		796,500		$	12.20		6.93
Granted		—		$	—
Exercised		(34,000	)	$	8.69			$	198
Forfeited		—		$	—
Outstanding at June 30, 2012		762,500		$	12.35		6.31	$	3,522
Exercisable on June 30, 2012		569,161		$	13.74		5.69	$	2,547
Expected to vest June 30, 2012		183,672		$	8.28		8.14	$	975

Restricted Stock

The following table sets forth the summary of activity for restricted stock grants, including performance-based awards, for the six months ended June 30, 2012:

	Shares			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2012		248,804		$	8.43
Granted		263,928		$	12.13
Vested		(65,808	)	$	7.92
Forfeited		(6,000	)	$	10.91
Nonvested at June 30, 2012		440,924		$	10.69

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Debt (Details 1) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Fair value of senior secured term loan based on quoted market prices
Carrying amount, net	$ 210,000	$ 198,923
Fair value	$ 218,400	$ 198,247

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Screenvision Exhibition, Inc. (Details) (USD $) In Thousands, unless otherwise specified	1 Months Ended		3 Months Ended		6 Months Ended			1 Months Ended	0 Months Ended	6 Months Ended	3 Months Ended		6 Months Ended
	Sep. 30, 2011	Jan. 31, 2011	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011	Dec. 31, 2011	Sep. 30, 2011 Class A membership units [Member]	Oct. 14, 2010 Class C membership units [Member]	Jun. 30, 2012 Class C membership units [Member]	Jun. 30, 2012 Screenvision [Member]	Jun. 30, 2011 Screenvision [Member]	Jun. 30, 2012 Screenvision [Member]	Jun. 30, 2011 Screenvision [Member]	Dec. 31, 2011 Screenvision [Member]
Screenvision Exhibition, Inc. (Textual) [Abstract]
Percentage of issued and outstanding membership units received								1.00%	20.00%
Carrying value of ownership interest in SV Holdco			$ 6,503		$ 6,503		$ 8,498				$ 5,546		$ 5,546
Threshold amount applicable for future profits and appreciation in assets									85,000	88,000
Maximum forfeiture limit										25.00%
Maximum bonus units to be received										33.00%
Concessions and other			49,355	46,794	96,872	81,467					2,100	2,500	4,400	4,300
Total intercompany gain			(448)	497	(992)	(304)					400	400	800	800
Amounts due included in accounts receivable related to Screenvision			5,659		5,659		4,985				1,874		1,874		1,860
Non-forfeitable Class C and Class A membership units			15.00%		15.00%
Voluntary capital contribution made to SV Holdco	718
Screenvision Exhibition, Inc. (Additional Textual) [Abstract]
Exhibition agreement, expiration date					Jul. 01, 2012
Modified Exhibition Agreement, additional term					30 years
Modified Exhibition Agreement, expiration date					Jul. 01, 2042
Cash received on Modified Exhibition Agreement		30,000
Percentage of Class C and Class A membership units held			19.00%		19.00%
Non-forfeitable ownership interest at estimated fair value			6,555		6,555
Concessions and other revenue on straight line basis					$ 36,555

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Debt (Tables)

6 Months Ended

Jun. 30, 2012

Debt [Abstract]

Components of debt

	June 30, 2012			December 31, 2011
Term loan	$	—		$	200,229
Senior secured notes		210,000			—
Revolving credit facility		—			—
Original issue discount		(488	)		(1,306	)
Total debt		209,512			198,923
Current maturities		—			(2,043	)
Total long-term debt	$	209,512		$	196,880

Fair value of senior secured term loan based on quoted market prices

	As of June 30,		As of December 31,
	2012		2011
Carrying amount, net	$	210,000	$	198,923	(1)
Fair value	$	217,400	$	198,247

(1) Term loan is reflected net of unamortized discount of $1,306 at December 31, 2011.