(26/09/2003) KINEPOLIS GROUP: half-yearly results, 2003

The Group loss for the first six-month period remains limited to E1.9 million, despite an 11.4% drop in visitor numbers, partly as a result of the exceptional fine weather. The net current result has improved by 49%. Continued progress has been made on the debt reduction programme, whilst the break-even forecast on an annual basis has been maintained. KINEPOLIS GROUP - RESULTS AS AT 30/06/2003

Millions of EUR	First half	First half	VAR.
	2003	2002
Number of visitors	11.6	13.1	-11.40%
Total turnover	89.4	100	-10.60%
Total turnover from cinema operations	84.2	95.1	-11.50%
EBITDA	16.1	20.2	-20.20%
EBIT	2.5	3.5	-28.50%
Financial results	-6.4	-9.4	31.90%
Extraordinary results	2.2	0.9	147.50%
Result before taxes	-1.7	-5	65.50%
Taxes and deferred taxes	-0.6	-1.4	56.80%
Net consolidated result	-2.3	-6.3	63.20%
Net consolidated result Group share	-1.9	-5.2	62.70%
Net current result	-2.8	-5.5	49.20%
Net Financial Debt Position	175.3	235.5	25.60%

Kinepolis Group welcomed 11.6 million visitors in the first six months of 2003, down 11.4% on the same period in 2002. When interpreting this fall in visitor numbers (from 13.1 million in the first half of 2002 to 11.6 million in 2003), the sale of the participation in Cinecity Treviso (May 2002), as well as Kinepolis Pioltello and Pentascoop (December 2002) should be taken into consideration. With these divestitures taken into account, the fall in visitor numbers is only 8.1%. The main reason for this fall is the exceptional weather conditions, with an uninterrupted period of hot weather stretching back to April. These same weather conditions have resulted in falling numbers of cinema-goers in the rest of Europe, with the decrease ranging from 12% to as much as 15%. The fall in turnover is causally linked to the fall in the numbers of cinema-goers. Thanks to the lower financial charges (less debt and exchange rate fluctuations), together with a positive extraordinary result, the net consolidated loss for Kinepolis Group has shrunk from E 5.2 million to E 1.9 million. The exchange loss on the Polish Zloty has a major impact of E 2.3 million on the half-yearly result in 2002. Overall financial indebtedness (1) falls by 26% in comparison with the half-yearly result in 2002, and by 12% in comparison with the position as at 31/12/02. (1) financial debts less GIMV subordinated loan, liquid assets and investments Comments on the key figures · Visitor numbers The number of visitors in the first half of 2003 is down 11.4% on the same period last year. On a comparable basis, however, (i.e. excluding the deconsolidated companies Kinepolis Pioltello, Pentascoop and Cinecity Treviso) this fall is only 8.1%. - Visitor numbers in Belgium and France were down by more than 10%, chiefly on account of the extremely good weather. The exception to this trend is Kinepolis Nîmes (France), which recorded growth of 15%. - In Spain the repercussions of the 'weather' phenomenon were less pronounced (-3%). - The complexes in Poland (Kinepolis Poznan +9%) and Switzerland (Kinepolis Schaffhausen +2%) are still experiencing an increase in visitor numbers in their growth phase. · Turnover Broadly speaking turnover has followed the evolution of visitor numbers. Turnover from film distribution almost doubled in respect of last year. There were hardly any activities in project development and film production and the results in the first half of the year were therefore virtually zero. · EBITDA EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) falls by 20% to E 16.1 million, a fall of E 4.1 million. On a comparable basis (excluding Kinepolis Pioltello, Pentascoop and Cinecity Treviso), EBITDA falls by only 16.9%. · EBIT EBIT (Earnings Before Interest and Taxes) fell from E 3.5 million in 2002 to E 2.5 million as at the end of June 2003. The loss on EBITDA is therefore partly recouped under the influence, among other things, of: - a fall in depreciation by E 2.2 million, E 1.0 million of which further to the changes in the number of cinemas owned. - the withdrawal of a reserve for contractor claims in Poland to the tune of E 0.9 million. · Financial results The financial result rises from E -9.4 million to E -6.4 million, an improvement of 32%. - Debt servicing costs have fallen by E 3 million under the influence of the debt reduction programme. The effect of the deconsolidations here amounts to E 0.5 million. - The exchange rate losses on the Polish Zloty as at 30/06/03 amounted to E 1.7 million, whilst those on the Swiss frank amounted to E 0.2 million. Hedge contracts were concluded for both currencies in March 2003, so that the exposure to these foreign exchange risks was largely covered. - A discount of the interest-free amount owed by the French Government pertaining to a capital investment grant amounted to E -0.7 million. · Extraordinary results The extraordinary result contains chiefly the capital gain realised on the sale of participating interests in Cinecity Treviso (55%, Italy) and RMBe (50%, Belgium). · Taxes and deferred taxation Taxes and deferred taxes fall to E 0.6 million chiefly under the influence of the lower results. Further to the impending implementation of the IAS standards, Kinepolis Groups has decided to bring its current valuation rules in respect of the calculation of deferred taxation partly in line with these new standards already. Consequently, from now on existing passive deferrals are to be decreased by the calculated active deferrals, although this will be limited to the extent of the passive deferrals. · Net consolidated result The net consolidated result rises from E -6.3 million as at 30 June 2002 to E -2.3 million as at 30 June 2003. The group share of the net consolidated result rises by 65% to E-1.9 million. The group share of the net current result improves by 41% to E -2.4 million. Debt reduction Further unrelenting progress was made on the debt reduction programme during the first half of 2003: The overall financial debt position (2) falls from E 198 million as at the end of 2002 to E 175 million as at 30 June 2003. The effect of the deconsolidations in this reduction amounts to E 3.4 million. The construction work for a new complex in Granada (Spain) will result in a partial increase in debt of some E 6 million during the second half of the year. The increase in the participation in Kinepolis Nîmes (France) to 80%, with full consolidation as a result, will cause the debt to rise by E 3.9 million. Notable events during the first half of 2003 and after the balance-sheet date · January 2003: Signing of an option contract for the purchase of a plot in Bruges · May 2003: Sale of Cinecity Treviso · June 2003: Sale of RMBe · July 2003: Increase in the participation in Kinepolis Nîmes (France) to 80% Prospects Kinepolis Group is assuming that visitor numbers will not experience any further percentage fall in the second half of the year. For 2003, the goal is set to achieve a net debt level of 15% less. Kinepolis Group still continues to strive for a break-even result. (2) financial debts less GIMV subordinated loan, liquid assets and investments Statutory Auditor's report FREE TRANSLATION Statutary Auditor's Report As part of our auditing mandate we have carried out a limited examination of the interim consolidated statements of Kinepolis Group NV as at 30 June 2003. This examination consisted of the analysis, comparison and discussion of the financial information, in accordance with the auditing recommendations of the Institute of Company Auditors with regard to limited examinations. Our examination was therefore less thorough than a full audit of the annual accounts. No data were revealed during this examination that would require major adaptations to the figures given in this press release. Antwerp, 25 September 2003 Klynveld Peat Marwick Goerdeler Bedrijfsrevisoren Represented by L. Ruysen Partner Financial Calendar Friday 17 October 2003: Visitor numbers Q3 2003 on web site www.kinepolis.com Friday 19 March 2004: Publication of 2002 Annual Results + analysts' meeting Friday, 18 April 2004 Visitor numbers Q1 2004 on web site www.kinepolis.com Friday 21 May 2004: General Meeting of Shareholders of Kinepolis Group n.v. Friday 21 May 2004: Publication of Q1 results 2004 + analysts' meeting Friday 16 July 2004: Visitor numbers S1 2004 on web site www.kinepolis.com Friday 3 September 2004: Publication of 2004 half-yearly results + analysts' meeting For further information Financial information: Florent Gijbels, CEO Operational information: Joost Bert, CEO Tel: 02/474.26.91 E-mail: mdassonville@kinepolis.com (C) Companynews