10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

__________________________________

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 26, 2013

Commission file number: 033-49598

___________________________________

UNITED ARTISTS THEATRE CIRCUIT, INC.

(Exact name of Registrant as Specified in its Charter) 

Maryland	13-1424080
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
7132 Regal Lane Knoxville, TN	37918
(Address of Principal Executive Offices)	(Zip Code)

 Registrant’s Telephone Number, Including Area Code: 865-922-1123

____________________________________

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 ¨
Non-accelerated filer x	Smaller reporting company ¨
(Do not check if a 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

The number of shares outstanding of $1.00 par value common stock at November 12, 2013 was 100 shares.

TABLE OF CONTENTS

PART I	Financial Information	3
Item 1.	Financial Statements	3
	Unaudited Condensed Consolidated Balance Sheets	3
	Unaudited Condensed Consolidated Statements of Income	4
	Unaudited Condensed Consolidated Statements of Cash Flows	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16
Item 4.	Controls and Procedures	17
PART II	Other Information	17
Item 1.	Legal Proceedings	17
Item 1A.	Risk Factors	17
Item 6.	Exhibits	17
Signatures		17

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PART I—FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

UNITED ARTISTS THEATRE CIRCUIT, INC.

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

	September 26, 2013			December 27, 2012
Assets
Current assets:
Cash and cash equivalents	$	67.0		$	54.7
Receivables	0.3			1.1
Prepaid expenses, concession inventory and other current assets	5.0			1.4
Deferred income tax asset	2.1			2.3
Total current assets	74.4			59.5
Property and equipment:
Land	2.7			2.7
Buildings, leasehold improvements and equipment	105.5			107.1
Total property and equipment	108.2			109.8
Accumulated depreciation and amortization	(76.6		)	(74.2		)
Total property and equipment, net	31.6			35.6
Goodwill	7.1			7.1
Other non-current assets	10.0			5.9
Total assets	$	123.1		$	108.1
Liabilities and Equity
Current liabilities:
Accounts payable	$	4.8		$	5.1
Accrued expenses and other	6.7			6.3
Current portion of debt obligations	0.3			0.3
Total current liabilities	11.8			11.7
Other non-current liabilities	4.9			1.8
Non-current deferred revenue	23.5			24.1
Long-term debt, less current portion	0.6			0.8
Deferred income tax liability	23.4			24.1
Total liabilities	64.2			62.5
Commitments and contingencies
Equity:
Preferred stock, $1.00 par value; 500,000 shares authorized, no shares issued and outstanding at September 26, 2013 and December 27, 2012	—			—
Common stock, $1.00 par value; 1,000 shares authorized, 100 shares issued and outstanding at September 26, 2013 and December 27, 2012	—			—
Additional paid-in capital	93.2			93.2
Retained earnings	54.7			47.7
Related party receivables	(89.3		)	(95.6		)
Total stockholder’s equity of United Artists Theatre Circuit, Inc.	58.6			45.3
Noncontrolling interest	0.3			0.3
Total equity	58.9			45.6
Total liabilities and equity	$	123.1		$	108.1

 See accompanying notes to unaudited condensed consolidated financial statements

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UNITED ARTISTS THEATRE CIRCUIT, INC.

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions)

	Quarter Ended September 26, 2013			Quarter Ended September 27, 2012			Three Quarters Ended September 26, 2013			Three Quarters Ended September 27, 2012
Revenues:
Admissions	$	36.9		$	35.0		$	102.6		$	106.8
Concessions	14.4			13.5			39.3			40.5
Other operating revenues	2.2			2.1			6.3			6.0
Total revenues	53.5			50.6			148.2			153.3
Operating expenses:
Film rental and advertising costs	18.9			17.7			52.4			53.9
Cost of concessions	1.9			1.8			5.3			5.3
Other theatre operating expenses	19.5			18.7			56.4			58.3
Sale and leaseback rentals	3.7			3.8			11.3			11.4
General and administrative expenses	1.6			1.5			4.5			4.6
Depreciation and amortization	1.7			1.9			5.3			6.2
Net loss on disposal and impairment of operating assets	—			—			1.3			0.3
Total operating expenses	47.3			45.4			136.5			140.0
Income from operations	6.2			5.2			11.7			13.3
Other expense (income):
Interest expense (income), net	—			—			—			—
Total other expense (income), net	—			—			—			—
Income before income taxes	6.2			5.2			11.7			13.3
Provision for income taxes	2.4			2.0			4.6			5.2
Net income	3.8			3.2			7.1			8.1
Noncontrolling interest, net of tax	(0.1		)	(0.1		)	(0.1		)	(0.1		)
Net income attributable to controlling interest	$	3.7		$	3.1		$	7.0		$	8.0

See accompanying notes to unaudited condensed consolidated financial statements.

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UNITED ARTISTS THEATRE CIRCUIT, INC.

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

	Three Quarters Ended September 26, 2013			Three Quarters Ended September 27, 2012
Cash flows from operating activities:
Net income	$	7.1		$	8.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5.3			6.2
Net loss on disposal and impairment of operating assets and other	1.3			0.3
Deferred income tax provision	(0.5		)	0.3
Effect of leases with escalating minimum annual rentals	(1.0		)	(0.9		)
Change in operating assets and liabilities:
Receivables	0.8			1.1
Prepaid expenses, concession inventory and other assets	(3.6		)	(3.6		)
Accounts payable	(0.3		)	(4.9		)
Deferred revenue	(0.6		)	(0.3		)
Accrued expenses and other liabilities	0.3			(0.9		)
Net cash provided by operating activities	8.8			5.4
Cash flows from investing activities:
Capital expenditures	(2.6		)	(3.6		)
Proceeds from disposition of assets	0.1			—
Distributions to partnership	(0.1		)	(0.1		)
Net cash used in investing activities	(2.6		)	(3.7		)
Cash flows from financing activities:
Debt payments	(0.2		)	(0.2		)
Decrease (increase) in related party receivables and other	6.3			(6.2		)
Net cash provided by (used in) financing activities	6.1			(6.4		)
Net increase (decrease) in cash and cash equivalents	12.3			(4.7		)
Cash and cash equivalents:
Beginning of period	54.7			54.8
End of period	$	67.0		$	50.1

See accompanying notes to unaudited condensed consolidated financial statements.

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UNITED ARTISTS THEATRE CIRCUIT, INC.

AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 26, 2013 AND SEPTEMBER 27, 2012

(1) The Company and Basis of Presentation

United Artists Theatre Company (the "Parent" or "United Artists"), a Delaware corporation, is the parent company of United Artists Theatre Circuit, Inc. ("we," "us," "our," the "Company" or "UATC") and United Artists Realty Company ("UAR"), which is the parent company of United Artists Properties I Corp. ("Prop I"). UATC leases certain theatres from Prop I. The terms UATC and the Company shall be deemed to include the respective subsidiaries of such entity when used in discussions included herein regarding the current operations or assets of such entity.

UATC operated 476 screens in 53 theatres in 17 states as of September 26, 2013. As of September 27, 2012, UATC operated 503 screens in 56 theatres in 17 states.  The Company formally operates on a 52-week fiscal year with each quarter generally consisting of 13 weeks, unless otherwise noted.  The Company’s fiscal year ends on the first Thursday after December 25, which in certain years results in a 53-week fiscal year.

The Company is a wholly owned subsidiary of Regal Cinemas, Inc. ("RCI"), which is an indirect wholly owned subsidiary of Regal Entertainment Group ("REG" or "Regal"). REG is controlled by Anschutz Company ("Anschutz"). RCI manages all aspects of the theatre operations of UATC and its subsidiaries and makes all business decisions on behalf of UATC pursuant to a management agreement.  In certain markets where UATC operates theatres, RCI also operates theatres.

For a discussion of the series of events leading to the formation of REG, REG’s acquisition of the Company and other significant transactions which have occurred through December 27, 2012, please refer to Notes 1 and 2 to the consolidated financial statements included in Part II, Item 8 of our annual report on Form 10-K, filed on March 22, 2013 with the Securities and Exchange Commission (the "Commission") (File No. 33-49598) for the fiscal year ended December 27, 2012 (the "2012 Audited Consolidated Financial Statements").  For a summary of our significant accounting policies, please refer to Note 3 to the 2012 Audited Consolidated Financial Statements.

The Company has prepared the unaudited condensed consolidated balance sheet as of September 26, 2013 and the unaudited condensed consolidated statements of income and cash flows for the quarters and three quarters ended September 26, 2013 and September 27, 2012 in accordance with U.S. generally accepted accounting principles for interim financial information and the rules and regulations of the Commission. Accordingly, certain information and footnote disclosures typically included in an annual report have been condensed or omitted for this quarterly report. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly in all material respects the financial position, results of operations and cash flows for all periods presented have been made. The December 27, 2012 unaudited condensed consolidated balance sheet information is derived from the 2012 Audited Consolidated Financial Statements. These unaudited condensed consolidated financial statements should be read in conjunction with the 2012 Audited Consolidated Financial Statements and notes thereto. The results of operations for the quarter and three quarters ended September 26, 2013 are not necessarily indicative of the operating results that may be achieved for the full 2013 fiscal year.

Net income and total comprehensive income are the same for all periods presented.

(2) Debt Obligations

Debt obligations are summarized as follows (amounts in millions):

	September 26, 2013			December 27, 2012
Debt obligations(a)	$	0.9		$	1.1
Less current portion	(0.3		)	(0.3		)
Long-term debt, less current portion	$	0.6		$	0.8

 ______________________________

(a)Debt obligations include $0.9 million and $1.1 million of capital lease obligations as of September 26, 2013 and December 27, 2012, respectively, which have an interest rate of 10.0%, maturing in 2016.

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(3) Related Party Transactions

Management Agreement

RCI manages all aspects of the theatre operations of UATC and its subsidiaries pursuant to the terms of a management agreement, which includes all of its cash collections, cash disbursements and other cash management functions. During the quarters ended September 26, 2013 and September 27, 2012, UATC recorded management fee expenses of approximately $1.6 million and $1.5 million, respectively, related to this agreement. During the three quarters ended September 26, 2013 and September 27, 2012, UATC recorded management fee expenses of approximately $4.5 million and $4.6 million, respectively, related to this agreement. Such fees have been recorded in the accompanying unaudited condensed consolidated statements of income as a component of "General and administrative expenses."

Related Party Receivables

The related party receivables balance of $95.6 million as of December 27, 2012 was comprised of approximately $9.8 million related to advances made to Prop I to fund additions and/or renovations to theatres leased from Prop I and approximately $85.8 million related to intercompany transactions and cash management.  The related party receivables balance of $89.3 million as of September 26, 2013 continued to be comprised of the $9.8 million receivable from Prop I and approximately $79.5 million related to intercompany transactions and cash management.

UATC leases three theatres from Prop I in accordance with a master lease (the "Prop I Master Lease"). The Prop I Master Lease commenced in 1988 with an original base term of 15 years and in 2003 UATC exercised a 10 year renewal extension of the lease. During 2013, the lease was subsequently extended through 2016. The Prop I Master Lease provides for basic monthly or quarterly rentals and may require additional rentals, based on the revenue of the underlying theatre. In order to fund the cost of additions and/or renovations to the theatres leased by UATC from Prop I, UATC made advances to Prop I prior to becoming a wholly owned subsidiary of REG in 2002.  Since 2002, UATC has not funded any additions and/or renovations for these properties and does not expect to make any advances to Prop 1 in future periods. The Prop I portion of the related party receivable balance ($9.8 million at September 26, 2013 and December 27, 2012) will be reduced upon any sale of the three properties by Prop I, with UATC receiving the net proceeds of the sale. The fair value of each of the three locations is evaluated periodically using the expected selling price less selling costs for each property.  Management’s estimates (Level 3 inputs as described in Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures) are based on recent market transactions and current real estate values within each market.  The Company has no current intention to market or sell the properties at this time, but believes that the fair market value of the three properties will be sufficient to substantially recover the current receivable from Prop I.

The decrease in the related party receivables balance of $6.3 million during the three quarters ended September 26, 2013 was due primarily to the timing of intercompany cash collections and disbursements particularly with respect to (1) the redemption of gift cards and discount tickets at UATC theatres that were sold by a subsidiary of RCI, Regal CineMedia Corporation ("RCM"), and (2) cash received by RCI for various revenue items, such as on-line ticket sales and rebates from vendor marketing programs, for UATC’s share of the revenues for such items. When RCI (or RCM) receives the cash for these items, revenue is recorded by UATC and a corresponding intercompany receivable is created, which is payable by RCI (or RCM) to UATC.  Increases in the intercompany receivable recorded by UATC could occur in future periods as long as the above described cash management activities continue as usual.  As of September 26, 2013, management believes the intercompany receivable is fully collectible.

National CineMedia, LLC Transactions

Pursuant to the Company’s management agreement with RCI, RCI, through an agreement with National CineMedia, LLC ("National CineMedia"), provides all on-screen and lobby advertising and event services to UATC.

In connection with the completion of the initial public offering, or IPO, of National CineMedia Inc.’s common stock, RCI amended and restated its existing exhibitor services agreement ("ESA") with National CineMedia, whereby in exchange for its pro rata share of the IPO proceeds, RCI agreed to a modification of National CineMedia’s payment obligation under the ESA.  The modification extended the term of the ESA to 30 years, provided National CineMedia with a five-year right of first refusal beginning one year prior to the end of the term and changed the basis upon which RCI is paid by National CineMedia from a percentage of revenues associated with advertising contracts entered into by National CineMedia to a monthly theatre

7

access fee.  Also, with respect to any on-screen advertising time provided by us to our beverage concessionaire, RCI is required to purchase such time from National CineMedia at a negotiated rate.

As a result of the ESA amendment and related modification payment, RCI recognizes various types of other revenue from National CineMedia, including per patron and per digital screen theatre access fees, net of payments for on-screen advertising time provided to the Company’s beverage concessionaire, other National CineMedia revenue and amortization of upfront ESA modification fees utilizing the units of revenue amortization method.

The Company’s portion of these revenues are presented as a component of "Other operating revenues" in the Company’s unaudited condensed consolidated financial statements and consist of the following amounts (in millions):

	Quarter Ended September 26, 2013			Quarter Ended September 27, 2012			Three Quarters Ended September 26, 2013			Three Quarters Ended September 27, 2012
Theatre access fees	$	0.5		$	0.4		$	1.2		$	1.2
Other NCM revenue	—			—			0.2			0.2
Amortization of ESA modification fees	0.1			0.1			0.3			0.3
Payments for beverage concessionaire advertising	(0.3		)	(0.3		)	(0.8		)	(0.8		)
Total	$	0.3		$	0.2		$	0.9		$	0.9

Digital Cinema Implementation Partners, LLC Transactions

Regal maintains an investment in Digital Cinema Implementation Partners, LLC, a Delaware limited liability company ("DCIP").  DCIP is a joint venture company formed by Regal, AMC Entertainment, Inc. ("AMC") and Cinemark, Inc. ("Cinemark"). On March 10, 2010, DCIP executed definitive agreements and related financing transactions in connection with the conversion to digital projection. Concurrent with closing, RCI entered into a master equipment lease agreement (the "Master Lease") and other related agreements with Kasima, LLC, a wholly-owned subsidiary of DCIP.

DCIP funds the cost of conversion to digital projection principally through the collection of virtual print fees from motion picture studios and equipment lease payments from participating exhibitors, including Regal. In accordance with the Master Lease, RCI will sublease (the "Sublease") the digital projection systems to UATC under a twelve-year term with tenone-year fair value renewal options. The Master Lease also contains a fair value purchase option.  Under the Master Lease and the Sublease, UATC pays RCI annual minimum rent of $1,000 per digital projection system from the effective date of the agreement through the end of the lease term and is, upon the conditions described below, subject to incremental annual rent of $2,000 per digital projection system beginning at six and a half years from the effective date of the agreement through the end of the lease term.  In the event that the junior capital raised by DCIP in the initial financing transactions remains outstanding at any time on or after the date that is six years, six months after the closing date of March 2010, the holders of the related notes will have the right to require Regal and other participating exhibitors to make incremental minimum rent payments of $2,000 per digital projection system per year through the earlier of the end of the lease term or until such notes are repaid.  UATC considers both the $1,000 minimum rental and the incremental minimum rental payment of $2,000 per digital projection system to be minimum rents and accordingly has recorded such rents on a straight-line basis in its consolidated financial statements. UATC is also subject to various types of other rent if such digital projection systems do not meet minimum performance requirements as outlined in the Master Lease and the Sublease. Certain of the other rent payments are subject to either a monthly or an annual maximum. UATC accounts for the Sublease as an operating lease for accounting purposes. During the three quarters ended September 26, 2013 and September 27, 2012, the Company incurred total rent of approximately $0.8 million and $0.7 million, respectively, associated with the leased digital projection systems. As of September 26, 2013, we operated 464 screens outfitted with digital projection systems.

(4) Sale—Leaseback Transactions

In December 1995, UATC entered into a sale and leaseback transaction whereby 31 owned properties were sold to and leased back from an unaffiliated third party. In conjunction with the transaction, the buyer of the properties issued publicly traded pass-through certificates. In connection with this sale and leaseback transaction, UATC entered into a Participation Agreement that requires UATC to comply with various covenants, including limitations on indebtedness, restricted payments, transactions with affiliates, guarantees, issuance of preferred stock of subsidiaries and subsidiary distributions, transfer of assets and payment of dividends. As of September 26, 2013,11 theatres were subject to the sale leaseback transaction and approximately $14.7 million in principal amount of pass-through certificates were outstanding.

8

(5) Income Taxes

The provision for income taxes of $2.4 million and $2.0 million for the quarters ended September 26, 2013 and September 27, 2012, respectively, reflect effective tax rates of 38.7% and 38.5%, respectively. The provision for income taxes of $4.6 million and $5.2 million for the three quarters ended September 26, 2013 and September 27, 2012, respectively, reflect effective tax rates of approximately 39.3% and 39.1%, respectively.  The effective tax rates for the quarters and three quarters ended September 26, 2013 and September 27, 2012 reflect the impact of certain non-deductible expenses.

In assessing the realizable value of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which these temporary differences become deductible. The Company maintains a valuation allowance against deferred tax assets of $2.4 million as of September 26, 2013 and December 27, 2012 as management believes it is more likely than not that certain deferred tax assets will not be realized in future tax periods. Future reductions in the valuation allowance associated with a change in management’s determination of the Company’s ability to realize these deferred tax assets will result in a decrease in the provision for income taxes.

The Company files income tax returns in the U.S. federal jurisdiction and certain state jurisdictions as part of the REG income tax filings and files separate income tax returns in various other state jurisdictions as well.  The Company's share of the REG current and deferred tax expense is determined on a separate company basis. REG and the Company are no longer subject to U.S. federal income tax examinations by taxing authorities for years before 2010, and with limited exceptions, are no longer subject to state income tax examinations for years before 2009.  However, the taxing authorities still have the ability to review the propriety of tax attributes created in closed tax years if such tax attributes are utilized in an open tax year.

(6) Litigation and Contingencies

The Company and its subsidiaries are presently involved in various judicial, administrative, regulatory and arbitration proceedings concerning matters arising in the ordinary course of business operations, including but not limited to, personal injury claims, landlord-tenant disputes, employment and other contractual matters, some of which are described below. Many of these proceedings are at preliminary stages, and many of these cases seek an indeterminate amount of damages. The Company’s theatre operations are also subject to federal, state and local laws governing such matters as wages, working conditions, citizenship and health and sanitation and environmental protection requirements.

On October 9, 2012, staff at the San Francisco Regional Water Quality Board (the "Regional Board") notified the Company, that the Regional Board was contemplating issuing a cleanup and abatement order to the Company with respect to a property in Santa Clara, California that the Company owned and then leased during the 1960s and 1970s. On June 25, 2013, the Regional Board issued a tentative order to the Company setting out proposed site clean-up requirements for the Company with respect to the property. According to the Regional Board, the property in question has been contaminated by dry-cleaning facilities that operated at the property in question from approximately 1961 until 1996. The Regional Board also issued a tentative order to the current property owner, who has been conducting site investigation and remediation activities at the site for several years. The Company submitted comments to the Regional Board on July 28, 2013, objecting to the tentative order. The Regional Board considered the matter at its regular meeting on September 11, 2013 and adopted the tentative order with only minor changes. On October 11, 2013, the Company filed a petition with the State Water Resources Control Board (“State Board”) for review of the Regional Board’s order. The State Board has not yet acted on the petition. The Company intends to vigorously defend this matter. We believe that we are, and were during the period in question described in this paragraph, in compliance with such applicable laws and regulations.

In situations where management believes that a loss arising from the above and similar other proceedings is probable and can be reasonably estimated, the Company records the amount of the loss, or the minimum estimated liability when the loss is estimated using a range and no amount within the range is more probable than another. As additional information becomes available, any potential liability related to these proceedings is assessed and the estimates are revised, if necessary. The amounts reserved for such proceedings totaled approximately $2.8 million as of September 26, 2013. Management believes any additional liability with respect to these claims and disputes will not be material in the aggregate to the Company's consolidated financial position, results of operations or cash flows.

Under ASC Topic 450, Contingencies—Loss Contingencies, an event is "reasonably possible" if "the chance of the future event or events occurring is more than remote but less than likely" and an event is "remote" if "the chance of the future event or events occurring is slight." Thus, references to the upper end of the range of reasonably possible loss for cases in which the Company is able to estimate a range of reasonably possible loss mean the upper end of the range of loss for cases for

9

which the Company believes the risk of loss is more than slight. Management is unable to estimate a range of reasonably possible loss for cases in which damages have not been specified and (i) the proceedings are in early stages, (ii) there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class, (iii) there is uncertainty as to the outcome of pending appeals or motions, (iv) there are significant factual issues to be resolved, and/or (v) there are novel legal issues presented. However, for these cases, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material adverse effect on the Company’s financial condition, though the outcomes could be material to the Company’s operating results for any particular period, depending, in part, upon the operating results for such period.

Our theatres must comply with Title III of the Americans with Disabilities Act of 1990 (the "ADA") to the extent that such properties are "public accommodations" and/or "commercial facilities" as defined by the ADA. Compliance with the ADA requires that public accommodations "reasonably accommodate" individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless "structurally impracticable" for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, awards of damages to private litigants and additional capital expenditures to remedy such non-compliance.

The accessibility of theatres to persons with visual impairments or that are deaf or hard of hearing remains a topic of interest to the Department of Justice and they have announced that they will be issuing another Advance Notice of Proposed Rulemaking concerning the provision of closed captioning and descriptive audio within the theatre environment. The Company believes it provides the members of the visually and hearing impaired communities with reasonable access to the movie-going experience, and has deployed new digital captioning and descriptive video systems that should meet all such potential requirements or expectations of any federal, state or individual concerns. The Company believes that it is in substantial compliance with all current applicable regulations relating to accommodations for the disabled. The Company intends to comply with future regulations in this regard and except as set forth above, does not currently anticipate that compliance will require the Company to expend substantial funds. 

(7) Recent Accounting Pronouncements

In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. Under ASU 2013-02, an entity is required to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional detail about those amounts. ASU 2013-02 became effective for the Company as of the beginning of fiscal 2013. The adoption of ASU 2013-02 had no impact on the Company's consolidated financial position, cash flows, or results of operations.

In July 2013, the FASB issued ASU 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The amendments in ASU 2013-11 require an entity to present an unrecognized tax benefit in the financial statements as a reduction to a deferred tax asset for a net operating loss ("NOL") carryforward, a similar tax loss, or a tax credit carryforward except when: (1) a NOL carryforward, a similar tax loss, or a tax credit carryforward is not available as of the reporting date under the governing tax law to settle taxes that would result from the disallowance of the tax position; or (2) the entity does not intend to use the deferred tax asset for this purpose (provided that the tax law permits a choice). If either of these conditions exists, an entity should present an unrecognized tax benefit in the financial statements as a liability and should not net the unrecognized tax benefit with a deferred tax asset. The amendment does not affect the recognition or measurement of uncertain tax positions under ASC Topic 740, Income Taxes. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. We do not expect this ASU to have a material impact to our consolidated financial statements.

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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Some of the information in this quarterly report on Form 10-Q includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act").  All statements other than statements of historical facts included in this Form 10-Q, including, without limitation, certain statements under "Management’s Discussion and Analysis of Financial Condition and Results of Operations", may constitute forward-looking statements. In some cases you can identify these "forward-looking statements" by words like "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of those words and other comparable words.  These forward-looking statements involve risks and uncertainties.  Our actual results could differ materially from those indicated in these statements as a result of certain factors as more fully discussed under the heading "Risk Factors" contained in our annual report on Form 10-K filed on March 22, 2013 with the Commission (File No. 033-49598) for the Company’s fiscal year ended December 27, 2012.  The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included herein.

Overview and Basis of Presentation

UATC operated 476 screens in 53 theatres in 17 states as of September 26, 2013. As of September 27, 2012, UATC operated 503 screens in 56 theatres in 17 states. The theatres we operate are managed by RCI, a wholly owned subsidiary of Regal, pursuant to a management arrangement described below. The Company formally operates on a 52-week fiscal year (ending on the first Thursday after December 25 each year) with each quarter generally consisting of 13 weeks, unless otherwise noted.  The Company manages its business under one reportable segment: theatre exhibition operations.

We generate revenues primarily from admissions and concession sales. Additional revenues are generated by our vendor marketing programs, various other activities in our theatres and our relationship with National CineMedia pursuant to the Company's arrangement with RCI (described further in Note 3 — "Related Party Transactions").  Film rental costs depend primarily on the popularity and box office revenues of a film, and such film rental costs generally increase as the admissions revenues generated by a film increase. Because we purchase certain concession items, such as fountain drinks and popcorn, in bulk and not pre-packaged for individual servings, we are able to improve our margins by negotiating volume discounts. Other operating expenses consist primarily of theatre labor and occupancy costs.

The Company’s revenues are usually seasonal, coinciding with the timing of releases of motion pictures by the major distributors. Generally, motion picture studios release the most marketable motion pictures during the summer and holiday seasons. The unexpected emergence or continuance of a "hit" film during other periods can alter the traditional pattern. The timing of movie releases can have a significant effect on the Company’s results of operations, and the results of one fiscal quarter are not necessarily indicative of the results for the next or any other fiscal quarter. The seasonality of motion picture exhibition, however, has become less pronounced as motion picture studios are releasing motion pictures somewhat more evenly throughout the year. The Company does not believe that inflation has had a material impact on its financial position or results of operations.

For a summary of industry trends as well as other risks and uncertainties relevant to the Company, see "Business-Industry Overview and Trends" and "Risk Factors" contained in our annual report on Form 10-K for the fiscal year ended December 27, 2012 and incorporated herein by reference and "Results of Operations" below.

Critical Accounting Estimates

For a discussion of accounting policies that we consider critical to our business operations and the understanding of our results of operations and affect the more significant judgments and estimates used in the preparation of our unaudited condensed consolidated financial statements, please refer to Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates" contained in our annual report on Form 10-K for the fiscal year ended December 27, 2012 and incorporated by reference herein.  As of September 26, 2013, there were no significant changes in our critical accounting policies or estimation procedures.

Significant Events

For a discussion of other significant operating, financing and investing transactions which have occurred through December 27, 2012, please refer to "Management’s Discussion and Analysis of Financial Condition and Results of Operations

11

—Liquidity and Capital Resources" included in Part II, Item 7 of our annual report on Form 10-K for the fiscal year ended December 27, 2012 and incorporated herein by reference.

Results of Operations

Based on our review of industry sources, North American box office revenues for the time period that corresponds to UATC’s third fiscal quarter of 2013 were estimated to have increased by approximately eight percent in comparison to the third fiscal quarter of 2012.  The industry’s box office results for the third quarter of 2013 were positively impacted by strong attendance from the breadth and commercial success of the overall film slate during the third quarter of 2013.

The following table sets forth the percentage of total revenues represented by certain items included in our unaudited condensed consolidated statements of income for the quarter ended September 26, 2013 ("Q3 2013 Period"), the quarter ended September 27, 2012 ("Q3 2012 Period"), the three quarters ended September 26, 2013 ("Fiscal 2013 Period") and the three quarters ended September 27, 2012 ("Fiscal 2012 Period):

	Q3 2013 Period		Q3 2012 Period		Fiscal 2013 Period		Fiscal 2012 Period
Revenues:
Admissions	69.0	%	69.2	%	69.2	%	69.7	%
Concessions	26.9		26.7		26.5		26.4
Other operating revenues	4.1		4.1		4.3		3.9
Total revenues	100.0		100.0		100.0		100.0
Operating expenses:
Film rental and advertising costs	35.3		35.0		35.4		35.2
Cost of concessions	3.6		3.6		3.6		3.5
Other theatre operating expenses	36.4		37.0		38.1		38.0
Sale and leaseback rentals	6.9		7.5		7.6		7.4
General and administrative expenses	3.0		3.0		3.0		3.0
Depreciation and amortization	3.2		3.8		3.6		4.0
Net loss on disposal and impairment of operating assets	—		—		0.9		0.2
Total operating expenses	88.4		89.7		92.1		91.3
Income from operations	11.6	%	10.3	%	7.9	%	8.7	%

Total Revenues

The following table summarizes revenues and revenue-related data for the Q3 2013 Period, the Q3 2012 Period, the Fiscal 2013 Period and the Fiscal 2012 Period (in millions, except average ticket prices and average concessions per patron):

	Q3 2013 Period		Q3 2012 Period		Fiscal 2013 Period		Fiscal 2012 Period
Admissions	$	36.9	$	35.0	$	102.6	$	106.8
Concessions	14.4		13.5		39.3		40.5
Other operating revenues	2.2		2.1		6.3		6.0
Total revenues	$	53.5	$	50.6	$	148.2	$	153.3
Attendance	4.1		4.0		11.3		11.9
Average ticket price(1)	$	9.00	$	8.75	$	9.08	$	8.97
Average concessions revenues per patron(2)	$	3.51	$	3.38	$	3.48	$	3.40

__________________________________

(1) Calculated as admissions revenue/attendance.

(2) Calculated as concessions revenue/attendance.

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Q3 2013 Period Compared to Q3 2012 Period and the Fiscal 2013 Period Compared to the Fiscal 2012 Period

Admissions

During the Q3 2013 Period, total admissions revenue increased $1.9 million, or 5.4%, to $36.9 million, from $35.0 million in the Q3 2012 Period A 2.9% increase in average ticket price (approximately $1.0 million of total admissions revenue) coupled with a 2.5% increase in attendance (approximately $0.9 million of total admissions revenue), led to the increase in the Q3 2013 Period admissions revenue. Attendance for the Q3 2013 Period was positively impacted by the breadth and commercial success of the overall film slate during the third quarter of 2013, partially offset by the closure of 27 underperforming screens during the twelve month period ended September 26, 2013. For the Fiscal 2013 Period, total admissions revenues decreased$4.2 million, or 3.9%, to $102.6 million, from $106.8 million in the Fiscal 2012 Period. A 5.0%decrease in attendance (approximately $5.3 million of total admissions revenue), partially offset by a 1.2%increase in average ticket prices (approximately $1.1 million of total admissions revenue), led to the net decrease in the Fiscal 2013 Period admissions revenue. We believe that our attendance is primarily dependent upon the commercial appeal of content released by the motion picture studios. Attendance for the Fiscal 2013 Period in comparison to that of the Fiscal 2012 Period was negatively impacted by the closure of 27 underperforming screens during the twelve month period ended September 26, 2013, partially offset by the breadth and commercial appeal of the overall film slate during the Fiscal 2013 Period. The average ticket price increase was due to selective price increases identified during our ongoing periodic pricing reviews, partially offset by a decrease in the percentage of our admissions revenues generated by premium format films exhibited during the Fiscal 2013 Period.

Concessions

Total concessions revenue increased$0.9 million, or 6.7%, to $14.4 million during the Q3 2013 Period, from $13.5 million for the Q3 2012 Period. During the Fiscal 2013 Period, total concessions revenues decreased$1.2 million, or 3.0%, to $39.3 million, from $40.5 million in the Fiscal 2012 Period.  Average concessions revenues per patron during the Q3 2013 Periodincreased3.8%, to $3.51, from $3.38 for the Q3 2012 Period and increased2.4%, to $3.48 during the Fiscal 2013 Period, from $3.40 in the Fiscal 2012 Period. The increase in total concessions revenue during the Q3 2013 Period was attributable to a 3.8% increase in average concessions revenues per patron (approximately $0.6 million of total concessions revenues) coupled with a 2.5% increase in attendance (approximately $0.3 million of total concessions revenues). The decrease in total concessions revenues during the Fiscal 2013 Period was attributable to the aforementioned decline in attendance during the period (approximately $2.0 million of total concessions revenues), partially offset by an increase in average concessions revenues per patron (approximately $0.8 million of total concessions revenues). The increase in average concessions revenues per patron for the Q3 2013 Period and the Fiscal 2013 Period was primarily a result of an increase in popcorn and beverage sales volume and to a lesser extent, selective price increases during the Q3 2013 Period and Fiscal 2013 Period.

Other Operating Revenues

During the Q3 2013 Period, other operating revenues increased$0.1 million, or 4.8%, to $2.2 million, from $2.1 million in the Q3 2012 Period. During the Fiscal 2013 Period, other operating revenues increased$0.3 million, or 5.0%, to $6.3 million, from $6.0 million for the Fiscal 2012 Period.  Included in other operating revenues are the theatre access fees paid by National CineMedia (net of payments for onscreen advertising time provided to our beverage concessionaire), revenues from our vendor marketing programs and other theatre revenues. The increase in other operating revenues during the Q3 2013 Period and the Fiscal 2013 Period was primarily driven by increases in revenues from our vendor marketing programs.

Operating Expenses

The following table summarizes certain operating expenses for the Q3 2013 Period, the Q3 2012 Period, the Fiscal 2013 Period and the Fiscal 2012 Period (dollars in millions): 

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	Q3 2013 Period		Q3 2012 Period		Fiscal 2013 Period		Fiscal 2012 Period
	$	% of Revenues	$	% of Revenues	$	% of Revenues	$	% of Revenues
Film rental and advertising costs(1)	18.9	51.2	17.7	50.6	52.4	51.1	53.9	50.5
Cost of concessions(2)	1.9	13.2	1.8	13.3	5.3	13.5	5.3	13.1
Other theatre operating expenses(3)	19.5	36.4	18.7	37.0	56.4	38.1	58.3	38.0
Sale and leaseback rentals(3)	3.7	6.9	3.8	7.5	11.3	7.6	11.4	7.4
General and administrative expenses(3)	1.6	3.0	1.5	3.0	4.5	3.0	4.6	3.0

____________________________________________

(1) Percentage of revenues calculated as a percentage of admissions revenues.

(2) Percentage of revenues calculated as a percentage of concessions revenues.

(3) Percentage of revenues calculated as a percentage of total revenues.

Film Rental and Advertising Costs

Film rental and advertising costs as a percentage of admissions revenues increased to 51.2% during the Q3 2013 Period from 50.6% in the Q3 2012 Period and for the Fiscal 2013 Period, increased to 51.1% from 50.5% in the Fiscal 2012 Period.  The increase in film rental and advertising costs as a percentage of box office revenues during the Q3 2013 Period and the Fiscal 2013 Period was primarily attributable to the mix of films exhibited during the Q3 2013 Period and Fiscal 2013 Period as compared to the comparable 2012 periods.

Cost of Concessions

During the Q3 2013 Period, cost of concessions increased$0.1 million, or 5.6%, to $1.9 million as compared to $1.8 million during the Q3 2012 Period. During the Fiscal 2013 Period, cost of concessions of $5.3 million was consistent with that of the Fiscal 2012 Period. Cost of concessions as a percentage of concessions revenues for the Q3 2013 Period was approximately 13.2%, compared to 13.3% during the Q3 2012 Period. For the Fiscal 2013 Period, cost of concessions as a percentage of concession revenues was approximately 13.5% compared to 13.1% for the Fiscal 2012 Period. The increase in cost of concessions as a percentage of concessions revenues during the Fiscal 2013 Period was primarily related to slightly higher raw material and packaged good costs during the period.

Other Theatre Operating Expense

Other theatre operating expenses increased$0.8 million, or 4.3%, to $19.5 million in the Q3 2013 Period, from $18.7 million in the Q3 2012 Period. During the Fiscal 2013 Period, other theatre operating expenses decreased$1.9 million, or 3.3%, to $56.4 million, from $58.3 million in the Fiscal 2012 Period.  The increase in other theatre operating expenses during the Q3 2013 Period was primarily attributable to increases in certain non-rent occupancy costs (approximately $0.6 million). The decrease in other theatre operating expenses during the Fiscal 2013 Period was attributable to reductions in certain non-rent occupancy costs (approximately $0.7 million), theatre level payroll (approximately $0.6 million), and utility expenses (approximately $0.3 million).

Sale and Leaseback Rentals

Sale and leaseback expenses of $3.7 million for the Q3 2013 Period were consistent with those of the Q3 2012 Period.    Sale and leaseback expenses of $11.3 million for the Fiscal 2013 Period were consistent with those of the Fiscal 2012 Period.    See Note 4 — "Sale-Leaseback Transactions" for further discussion of sale and leaseback transactions.

General and Administrative Expenses

General and administrative expenses of $1.6 million for the Q3 2013 Periodincreased$0.1 million, or 6.7%, from $1.5 million in the Q3 2012 Period. General and administrative expenses decreased$0.1 million, or 2.2%, to $4.5 million during the Fiscal 2013 Period, from $4.6 million in the Fiscal 2012 Period.  Included in general and administrative expenses are management fees associated with the management agreement between RCI and UATC under which RCI manages the theatre operations of UATC.  The increase in general and administrative expenses during the Q3 2013 Period was due to the increase in management fee costs incurred resulting from the increase in total revenues during the Q3 2013 Period. The decrease in general and administrative expenses during the Fiscal 2013 Period was due to the decrease in management fee costs incurred resulting from the decline in total revenues during the Fiscal 2013 Period.  As a percentage of total revenues, general and

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administrative expenses during the Q3 2013 Period and the Fiscal 2013 Period were relatively consistent with that of the corresponding 2012 periods.

Depreciation and Amortization

Depreciation and amortization expense decreased$0.2 million, or 10.5%, to $1.7 million for the Q3 2013 Period, from $1.9 million in the Q3 2012 Period. During the Fiscal 2013 Period, depreciation and amortization expense decreased$0.9 million, or 14.5%, to $5.3 million, from $6.2 million in the Fiscal 2012 Period.  The decrease in depreciation and amortization expense during the Q3 2013 Period and the Fiscal 2013 Period as compared to the Q3 2012 Period and the Fiscal 2012 Period was primarily due to the reduction in our screen count subsequent to the end of the Q3 2012 Period.

Net Loss on Disposal and Impairment of Operating Assets

Net loss on disposal and impairment of operating assets increased$1.0 million, to $1.3 million in the Fiscal 2013 Period, from $0.3 million in the Fiscal 2012 Period. The increase in net loss on disposal and impairment of operating assets during the Fiscal 2013 Period was primarily attributable to the closure of one underperforming theatre with nine screens during the quarter ended June 27, 2013.

Income from Operations

Income from operations increased$1.0 million, or 19.2%, to $6.2 million during the Q3 2013 Period, from $5.2 million in the Q3 2012 Period. During the Fiscal 2013 Period, income from operations decreased$1.6 million, or 12.0% to $11.7 million, from $13.3 million in the Fiscal 2012 Period.  The increase in income from operations during the Q3 2013 Period as compared to the Q3 2012 Period was primarily attributable to the increase in total revenues, partially offset by increases in certain variable operating expense line items described above. The decrease in income from operations during the Fiscal 2013 Period as compared to the Fiscal 2012 Period was primarily attributable to the decline in total revenues and a $1.0 million higher net loss on disposal and impairment of operating assets, partially offset by reductions in certain variable operating expense line items described above.

Income Taxes

The provision for income taxes of $2.4 million and $2.0 million for the Q3 2013 Period and the Q3 2012 Period, respectively, reflect effective tax rates of approximately 38.7% and 38.5%, respectively. The provision for income taxes of $4.6 million and $5.2 million for the Fiscal 2013 Period and the Fiscal 2012 Period, respectively, reflect effective tax rates of approximately 39.3% and 39.1%, respectively. The effective tax rates for all periods presented reflect the impact of certain non-deductible expenses.

Net Income Attributable to Controlling Interest

Net income attributable to controlling interest for the Q3 2013 Period totaled $3.7 million, which represents an increase of $0.6 million, from net income attributable to controlling interest of $3.1 million in the Q3 2012 Period. During the Fiscal 2013 Period, net income attributable to controlling interest totaled $7.0 million, which represents a decrease of $1.0 million, from net income attributable to controlling interest of $8.0 million in the Fiscal 2012 Period.  The increase in net income attributable to controlling interest for the Q3 2013 Period was attributable to an increase in operating income described above. The decrease in net income attributable to controlling interest for the Fiscal 2013 Period was primarily attributable to a decrease in operating income described above, partially offset by a decrease in income taxes described above.

Liquidity and Capital Resources

On a consolidated basis, we expect our primary uses of cash to be for operating expenses, capital expenditures, investments, general corporate purposes related to corporate operations, related party transactions and debt services.  The principal sources of liquidity are cash generated from operations and cash on hand.

Operating Activities

Our revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit cards at the point of sale. Our operating expenses are primarily related to film and advertising costs, rent and occupancy and payroll. Film costs are ordinarily paid to distributors within 30 days following receipt of admissions revenues and the cost of the Company’s concessions are generally paid to vendors approximately 30 to 35 days from purchase. Our current liabilities

15

include items that will become due within 12 months.  In addition, from time to time, we may use cash from operations to fund dividends to our Parent in excess of net income attributable to controlling interest and cash flows from operating activities less cash flows from investing and other financing activities.  As a result, at any given time, our balance sheet may reflect a working capital deficit.

Net cash flows provided by operating activities totaled approximately $8.8 million and $5.4 million for the Fiscal 2013 Period and the Fiscal 2012 Period, respectively. The $3.4 million net increase in net cash flows provided by operating activities for the Fiscal 2013 Period as compared to the Fiscal 2012 Period was caused by a change in working capital activity of approximately $5.2 million, partially offset by a $1.8 million decrease in net income excluding non-cash items. Working capital activity was primarily impacted by changes in accounts payable and accrued expense and other activity during the Fiscal 2013 Period as compared to the Fiscal 2012 Period. The change in accounts payable activity and accrued expense and other activity during the Fiscal 2013 Period as compared to the Fiscal 2012 Period was primarily associated with the timing of film and certain other vendor payments during such periods.

Investing Activities

Our capital requirements have historically arisen principally in connection with retrofitting existing theatres, upgrading the Company’s theatre facilities and replacing equipment. We fund the cost of capital expenditures through internally generated cash flows and cash on hand.

The Company has a formal and intensive review procedure for the authorization of capital projects, with the most important financial measure of acceptability for a discretionary non-maintenance capital project being whether its projected discounted cash flow return on investment meets or exceeds the Company’s internal rate of return targets.  We currently expect capital expenditures for theatre expansion, upgrading and equipment replacements to be in the range of approximately $3.0 million to $7.0 million in fiscal year 2013.

Net cash flows used in investing activities totaled approximately $2.6 million and $3.7 million for the Fiscal 2013 Period and the Fiscal 2012 Period, respectively. The $1.1 million decrease in cash flows used in investing activities during the Fiscal 2013 Period, as compared to the Fiscal 2012 Period, was attributable to a $1.0 million decrease in capital expenditures and a $0.1 million increase in proceeds from the disposition of assets.

Financing Activities

Net cash flows provided by (used in) financing activities totaled approximately $6.1 million and $(6.4) million for the Fiscal 2013 Period and the Fiscal 2012 Period, respectively. The $12.5 million increase in cash flows provided by financing activities during the Fiscal 2013 Period, as compared to the Fiscal 2012 Period, was attributable to the change in related party receivables during the Fiscal 2013 Period as compared to the Fiscal 2012 Period.

Contractual Cash Obligations and Commitments

For a summary of our contractual cash obligations and commitments and off-balance sheet arrangements as of December 27, 2012, please refer to Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Contractual Cash Obligations and Commitments" contained in our annual report on Form 10-K for the fiscal year ended December 27, 2012 and incorporated by reference herein.  As of September 26, 2013, there were no material changes outside the ordinary course of our business in our contractual cash obligations and commitments.  We believe that the amount of cash and cash equivalents on hand and cash flow expected from operations will be adequate for the Company to execute its business strategy and meet anticipated requirements for lease obligations, capital expenditures, working capital and debt service for the next 12 months.

Recent Accounting Pronouncements

For a discussion of the recent accounting pronouncements relevant to our operations, please refer to the information provided under Note 7 — "Recent Accounting Pronouncements" of our notes to the accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 (Financial Statements) of this Form 10-Q, which information is incorporated by reference herein.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

UATC does not maintain any direct exposure to market risk as of September 26, 2013.

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Item 4. CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit to the Commission under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified by the Commission’s rules and forms, and that information is accumulated and communicated to our management, including our principal executive, principal financial and principal accounting officers (whom we refer to in this periodic report as our Certifying Officers), as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our Certifying Officers, the effectiveness of our disclosure controls and procedures as of September 26, 2013, pursuant to Rule 15d-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that, as of September 26, 2013, our disclosure controls and procedures were effective.

There were no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Information required to be furnished by us under this Part II, Item 1 (Legal Proceedings) is incorporated by reference to Note 6 — "Litigation and Contingencies" of our notes to the accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 (Financial Statements) of this quarterly report on Form 10-Q.

Item 1A. RISK FACTORS

There have been no material changes from risk factors as previously disclosed in our annual report on Form 10-K for the fiscal year ended December 27, 2012, filed with the Commission on March 22, 2013 (File No. 033-49598).

Item 6. EXHIBITS

Exhibit  Number	Description
31.1	Rule 15d-14(a) Certification of Principal Executive Officer
31.2	Rule 15d-14(a) Certification of Principal Financial Officer
101	Financial statements from the quarterly report on Form 10-Q of United Artists Theatre Circuit, Inc. for the quarter ended September 26, 2013, filed on November 12, 2013, formatted in XBRL: (i) the Unaudited Condensed Consolidated Balance Sheets, (ii) the Unaudited Condensed Consolidated Statements of Income, (iii) the Unaudited Condensed Consolidated Statements of Cash Flows and (iv) the Notes to Unaudited Condensed Consolidated Financial Statements tagged as detailed text.

17

SIGNATURES

Pursuant to the requirements 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. 

		UNITED ARTISTS THEATRE CIRCUIT, INC.
Date:	November 12, 2013	By:	/s/ AMY E. MILES
			Amy E. Miles
			President
			(Principal Executive Officer)
Date:	November 12, 2013	By:	/s/ DAVID H. OWNBY
			David H. Ownby
			Vice President and Treasurer
			(Principal Financial Officer and Principal Accounting Officer)

EXHIBIT INDEX

Exhibit  Number	Description
31.1	Rule 15d-14(a) Certification of Principal Executive Officer
31.2	Rule 15d-14(a) Certification of Principal Financial Officer
101	Financial statements from the quarterly report on Form 10-Q of United Artists Theatre Circuit, Inc. for the quarter ended September 26, 2013, filed on November 12, 2013, formatted in XBRL: (i) the Unaudited Condensed Consolidated Balance Sheets, (ii) the Unaudited Condensed Consolidated Statements of Income, (iii) the Unaudited Condensed Consolidated Statements of Cash Flows and (iv) the Notes to Unaudited Condensed Consolidated Financial Statements tagged as detailed text.

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EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Amy E. Miles, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Artists Theatre Circuit, 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(s) 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(s) 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:	November 12, 2013	By:	/s/ AMY E. MILES
			Amy E. Miles
			President
			(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, David H. Ownby, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Artists Theatre Circuit, 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(s) 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(s) 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:	November 12, 2013	By:	/s/ DAVID H. OWNBY
			David H. Ownby
			Vice President and Treasurer
			(Principal Financial Officer)

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Related Party Transactions (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended			3 Months Ended		9 Months Ended				9 Months Ended
	Sep. 26, 2013 property	Sep. 27, 2012	Dec. 27, 2012	Sep. 26, 2013 RCI	Sep. 27, 2012 RCI	Sep. 26, 2013 RCI	Sep. 27, 2012 RCI	Sep. 26, 2013 Prop I theatre	Dec. 27, 2012 Prop I	Sep. 26, 2013 NCM Inc. RCI	Sep. 27, 2012 NCM Inc. RCI	Sep. 26, 2013 DCIP RCI renewal_option screen	Sep. 27, 2012 DCIP RCI
Related Party Transactions
Management fee expenses				$ 1.6	$ 1.5	$ 4.5	$ 4.6
Related party receivables	89.3		95.6					9.8	9.8
Receivables related to intercompany transactions and cash management	79.5		85.8
Number of theatres subject to lease	3							3
Original base term of lease								15 years
Renewal extension period of the lease								10 years
Decrease in related party receivables due to the timing of intercompany cash collections and disbursements								(6.3)
Extended term of exhibitor services agreement										30 years
Right of first refusal period										5 years
Period prior to end of agreement term for commencement of right of first refusal										1 year
Maximum term of lease, excluding renewal options												12 years
Number of one-year fair value renewal options												10
Fair value renewal options term												1 year
Annual minimum rent per digital projection system, from effective date of agreement through the end of the lease term												1,000
Incremental annual minimum rent per digital projection system beginning six and half years from agreement effective date, upon certain conditions												2,000
Annual minimum rent, initial period												6 years 6 months
Leased digital projection systems, total rent												0.8	0.7
Number of screens operated, outfitted with digital projection systems												464
Other operating revenues, other revenue from National CineMedia
Theatre access fees	0.5	0.4								1.2	1.2
Other NCM revenue	0	0								0.2	0.2
Amortization of ESA modification fees	0.1	0.1								0.3	0.3
Payments for beverage concessionaire advertising	(0.3)	(0.3)								(0.8)	(0.8)
Total	$ 0.3	$ 0.2								$ 0.9	$ 0.9

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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 26, 2013	Sep. 27, 2012	Sep. 26, 2013	Sep. 27, 2012
Revenues:
Admissions	$ 36.9	$ 35.0	$ 102.6	$ 106.8
Concessions	14.4	13.5	39.3	40.5
Other operating revenues	2.2	2.1	6.3	6.0
Total revenues	53.5	50.6	148.2	153.3
Operating expenses:
Film rental and advertising costs	18.9	17.7	52.4	53.9
Cost of concessions	1.9	1.8	5.3	5.3
Other theatre operating expenses	19.5	18.7	56.4	58.3
Sale and leaseback rentals	3.7	3.8	11.3	11.4
General and administrative expenses	1.6	1.5	4.5	4.6
Depreciation and amortization	1.7	1.9	5.3	6.2
Net loss on disposal and impairment of operating assets	0	0	1.3	0.3
Total operating expenses	47.3	45.4	136.5	140.0
Income from operations	6.2	5.2	11.7	13.3
Other expense (income):
Interest expense (income), net	0	0	0	0
Total other expense (income), net	0	0	0	0
Income before income taxes	6.2	5.2	11.7	13.3
Provision for income taxes	2.4	2.0	4.6	5.2
Net income	3.8	3.2	7.1	8.1
Noncontrolling interest, net of tax	(0.1)	(0.1)	(0.1)	(0.1)
Net income attributable to controlling interest	$ 3.7	$ 3.1	$ 7.0	$ 8.0

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Income Taxes

9 Months Ended

Sep. 26, 2013

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provision for income taxes of $2.4 million and $2.0 million for the quarters ended September 26, 2013 and September 27, 2012, respectively, reflect effective tax rates of 38.7% and 38.5%, respectively. The provision for income taxes of $4.6 million and $5.2 million for the three quarters ended September 26, 2013 and September 27, 2012, respectively, reflect effective tax rates of approximately 39.3% and 39.1%, respectively.  The effective tax rates for the quarters and three quarters ended September 26, 2013 and September 27, 2012 reflect the impact of certain non-deductible expenses.

In assessing the realizable value of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which these temporary differences become deductible. The Company maintains a valuation allowance against deferred tax assets of $2.4 million as of September 26, 2013 and December 27, 2012 as management believes it is more likely than not that certain deferred tax assets will not be realized in future tax periods. Future reductions in the valuation allowance associated with a change in management’s determination of the Company’s ability to realize these deferred tax assets will result in a decrease in the provision for income taxes.

The Company files income tax returns in the U.S. federal jurisdiction and certain state jurisdictions as part of the REG income tax filings and files separate income tax returns in various other state jurisdictions as well.  The Company's share of the REG current and deferred tax expense is determined on a separate company basis. REG and the Company are no longer subject to U.S. federal income tax examinations by taxing authorities for years before 2010, and with limited exceptions, are no longer subject to state income tax examinations for years before 2009.  However, the taxing authorities still have the ability to review the propriety of tax attributes created in closed tax years if such tax attributes are utilized in an open tax year.

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Sale-Leaseback Transactions (Details) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Dec. 31, 1995 property	Sep. 26, 2013 theatre
Sale Leaseback Transactions
Number of owned properties sold to and leased back from an unaffiliated third party	31
Number of theatres subject to the sale leaseback transaction		11
Outstanding principal amount of pass-through certificates		$ 14.7

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The Company and Basis of Presentation

9 Months Ended

Sep. 26, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The Company and Basis of Presentation

The Company and Basis of Presentation

United Artists Theatre Company (the "Parent" or "United Artists"), a Delaware corporation, is the parent company of United Artists Theatre Circuit, Inc. ("we," "us," "our," the "Company" or "UATC") and United Artists Realty Company ("UAR"), which is the parent company of United Artists Properties I Corp. ("Prop I"). UATC leases certain theatres from Prop I. The terms UATC and the Company shall be deemed to include the respective subsidiaries of such entity when used in discussions included herein regarding the current operations or assets of such entity.

UATC operated 476 screens in 53 theatres in 17 states as of September 26, 2013. As of September 27, 2012, UATC operated 503 screens in 56 theatres in 17 states.  The Company formally operates on a 52-week fiscal year with each quarter generally consisting of 13 weeks, unless otherwise noted.  The Company’s fiscal year ends on the first Thursday after December 25, which in certain years results in a 53-week fiscal year.

The Company is a wholly owned subsidiary of Regal Cinemas, Inc. ("RCI"), which is an indirect wholly owned subsidiary of Regal Entertainment Group ("REG" or "Regal"). REG is controlled by Anschutz Company ("Anschutz"). RCI manages all aspects of the theatre operations of UATC and its subsidiaries and makes all business decisions on behalf of UATC pursuant to a management agreement.  In certain markets where UATC operates theatres, RCI also operates theatres.

For a discussion of the series of events leading to the formation of REG, REG’s acquisition of the Company and other significant transactions which have occurred through December 27, 2012, please refer to Notes 1 and 2 to the consolidated financial statements included in Part II, Item 8 of our annual report on Form 10-K, filed on March 22, 2013 with the Securities and Exchange Commission (the "Commission") (File No. 33-49598) for the fiscal year ended December 27, 2012 (the "2012 Audited Consolidated Financial Statements").  For a summary of our significant accounting policies, please refer to Note 3 to the 2012 Audited Consolidated Financial Statements.

The Company has prepared the unaudited condensed consolidated balance sheet as of September 26, 2013 and the unaudited condensed consolidated statements of income and cash flows for the quarters and three quarters ended September 26, 2013 and September 27, 2012 in accordance with U.S. generally accepted accounting principles for interim financial information and the rules and regulations of the Commission. Accordingly, certain information and footnote disclosures typically included in an annual report have been condensed or omitted for this quarterly report. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly in all material respects the financial position, results of operations and cash flows for all periods presented have been made. The December 27, 2012 unaudited condensed consolidated balance sheet information is derived from the 2012 Audited Consolidated Financial Statements. These unaudited condensed consolidated financial statements should be read in conjunction with the 2012 Audited Consolidated Financial Statements and notes thereto. The results of operations for the quarter and three quarters ended September 26, 2013 are not necessarily indicative of the operating results that may be achieved for the full 2013 fiscal year.

Net income and total comprehensive income are the same for all periods presented.

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Related Party Transactions

9 Months Ended

Sep. 26, 2013

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Management Agreement

RCI manages all aspects of the theatre operations of UATC and its subsidiaries pursuant to the terms of a management agreement, which includes all of its cash collections, cash disbursements and other cash management functions. During the quarters ended September 26, 2013 and September 27, 2012, UATC recorded management fee expenses of approximately $1.6 million and $1.5 million, respectively, related to this agreement. During the three quarters ended September 26, 2013 and September 27, 2012, UATC recorded management fee expenses of approximately $4.5 million and $4.6 million, respectively, related to this agreement. Such fees have been recorded in the accompanying unaudited condensed consolidated statements of income as a component of "General and administrative expenses."

Related Party Receivables

The related party receivables balance of $95.6 million as of December 27, 2012 was comprised of approximately $9.8 million related to advances made to Prop I to fund additions and/or renovations to theatres leased from Prop I and approximately $85.8 million related to intercompany transactions and cash management.  The related party receivables balance of $89.3 million as of September 26, 2013 continued to be comprised of the $9.8 million receivable from Prop I and approximately $79.5 million related to intercompany transactions and cash management.

UATC leases three theatres from Prop I in accordance with a master lease (the "Prop I Master Lease"). The Prop I Master Lease commenced in 1988 with an original base term of 15 years and in 2003 UATC exercised a 10 year renewal extension of the lease. During 2013, the lease was subsequently extended through 2016. The Prop I Master Lease provides for basic monthly or quarterly rentals and may require additional rentals, based on the revenue of the underlying theatre. In order to fund the cost of additions and/or renovations to the theatres leased by UATC from Prop I, UATC made advances to Prop I prior to becoming a wholly owned subsidiary of REG in 2002.  Since 2002, UATC has not funded any additions and/or renovations for these properties and does not expect to make any advances to Prop 1 in future periods. The Prop I portion of the related party receivable balance ($9.8 million at September 26, 2013 and December 27, 2012) will be reduced upon any sale of the three properties by Prop I, with UATC receiving the net proceeds of the sale. The fair value of each of the three locations is evaluated periodically using the expected selling price less selling costs for each property.  Management’s estimates (Level 3 inputs as described in Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures) are based on recent market transactions and current real estate values within each market.  The Company has no current intention to market or sell the properties at this time, but believes that the fair market value of the three properties will be sufficient to substantially recover the current receivable from Prop I.

The decrease in the related party receivables balance of $6.3 million during the three quarters ended September 26, 2013 was due primarily to the timing of intercompany cash collections and disbursements particularly with respect to (1) the redemption of gift cards and discount tickets at UATC theatres that were sold by a subsidiary of RCI, Regal CineMedia Corporation ("RCM"), and (2) cash received by RCI for various revenue items, such as on-line ticket sales and rebates from vendor marketing programs, for UATC’s share of the revenues for such items. When RCI (or RCM) receives the cash for these items, revenue is recorded by UATC and a corresponding intercompany receivable is created, which is payable by RCI (or RCM) to UATC.  Increases in the intercompany receivable recorded by UATC could occur in future periods as long as the above described cash management activities continue as usual.  As of September 26, 2013, management believes the intercompany receivable is fully collectible.

National CineMedia, LLC Transactions

Pursuant to the Company’s management agreement with RCI, RCI, through an agreement with National CineMedia, LLC ("National CineMedia"), provides all on-screen and lobby advertising and event services to UATC.

In connection with the completion of the initial public offering, or IPO, of National CineMedia Inc.’s common stock, RCI amended and restated its existing exhibitor services agreement ("ESA") with National CineMedia, whereby in exchange for its pro rata share of the IPO proceeds, RCI agreed to a modification of National CineMedia’s payment obligation under the ESA.  The modification extended the term of the ESA to 30 years, provided National CineMedia with a five-year right of first refusal beginning one year prior to the end of the term and changed the basis upon which RCI is paid by National CineMedia from a percentage of revenues associated with advertising contracts entered into by National CineMedia to a monthly theatre access fee.  Also, with respect to any on-screen advertising time provided by us to our beverage concessionaire, RCI is required to purchase such time from National CineMedia at a negotiated rate.

As a result of the ESA amendment and related modification payment, RCI recognizes various types of other revenue from National CineMedia, including per patron and per digital screen theatre access fees, net of payments for on-screen advertising time provided to the Company’s beverage concessionaire, other National CineMedia revenue and amortization of upfront ESA modification fees utilizing the units of revenue amortization method.

The Company’s portion of these revenues are presented as a component of "Other operating revenues" in the Company’s unaudited condensed consolidated financial statements and consist of the following amounts (in millions):

	Quarter Ended September 26, 2013			Quarter Ended September 27, 2012			Three Quarters Ended September 26, 2013			Three Quarters Ended September 27, 2012
Theatre access fees	$	0.5		$	0.4		$	1.2		$	1.2
Other NCM revenue	—			—			0.2			0.2
Amortization of ESA modification fees	0.1			0.1			0.3			0.3
Payments for beverage concessionaire advertising	(0.3		)	(0.3		)	(0.8		)	(0.8		)
Total	$	0.3		$	0.2		$	0.9		$	0.9

Digital Cinema Implementation Partners, LLC Transactions

Regal maintains an investment in Digital Cinema Implementation Partners, LLC, a Delaware limited liability company ("DCIP").  DCIP is a joint venture company formed by Regal, AMC Entertainment, Inc. ("AMC") and Cinemark, Inc. ("Cinemark"). On March 10, 2010, DCIP executed definitive agreements and related financing transactions in connection with the conversion to digital projection. Concurrent with closing, RCI entered into a master equipment lease agreement (the "Master Lease") and other related agreements with Kasima, LLC, a wholly-owned subsidiary of DCIP.

DCIP funds the cost of conversion to digital projection principally through the collection of virtual print fees from motion picture studios and equipment lease payments from participating exhibitors, including Regal. In accordance with the Master Lease, RCI will sublease (the "Sublease") the digital projection systems to UATC under a twelve-year term with tenone-year fair value renewal options. The Master Lease also contains a fair value purchase option.  Under the Master Lease and the Sublease, UATC pays RCI annual minimum rent of $1,000 per digital projection system from the effective date of the agreement through the end of the lease term and is, upon the conditions described below, subject to incremental annual rent of $2,000 per digital projection system beginning at six and a half years from the effective date of the agreement through the end of the lease term.  In the event that the junior capital raised by DCIP in the initial financing transactions remains outstanding at any time on or after the date that is six years, six months after the closing date of March 2010, the holders of the related notes will have the right to require Regal and other participating exhibitors to make incremental minimum rent payments of $2,000 per digital projection system per year through the earlier of the end of the lease term or until such notes are repaid.  UATC considers both the $1,000 minimum rental and the incremental minimum rental payment of $2,000 per digital projection system to be minimum rents and accordingly has recorded such rents on a straight-line basis in its consolidated financial statements. UATC is also subject to various types of other rent if such digital projection systems do not meet minimum performance requirements as outlined in the Master Lease and the Sublease. Certain of the other rent payments are subject to either a monthly or an annual maximum. UATC accounts for the Sublease as an operating lease for accounting purposes. During the three quarters ended September 26, 2013 and September 27, 2012, the Company incurred total rent of approximately $0.8 million and $0.7 million, respectively, associated with the leased digital projection systems. As of September 26, 2013, we operated 464 screens outfitted with digital projection systems.

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Litigation and Contingencies

9 Months Ended

Sep. 26, 2013

Commitments and Contingencies Disclosure [Abstract]

Litigation and Contingencies

Litigation and Contingencies

The Company and its subsidiaries are presently involved in various judicial, administrative, regulatory and arbitration proceedings concerning matters arising in the ordinary course of business operations, including but not limited to, personal injury claims, landlord-tenant disputes, employment and other contractual matters, some of which are described below. Many of these proceedings are at preliminary stages, and many of these cases seek an indeterminate amount of damages. The Company’s theatre operations are also subject to federal, state and local laws governing such matters as wages, working conditions, citizenship and health and sanitation and environmental protection requirements.

On October 9, 2012, staff at the San Francisco Regional Water Quality Board (the "Regional Board") notified the Company, that the Regional Board was contemplating issuing a cleanup and abatement order to the Company with respect to a property in Santa Clara, California that the Company owned and then leased during the 1960s and 1970s. On June 25, 2013, the Regional Board issued a tentative order to the Company setting out proposed site clean-up requirements for the Company with respect to the property. According to the Regional Board, the property in question has been contaminated by dry-cleaning facilities that operated at the property in question from approximately 1961 until 1996. The Regional Board also issued a tentative order to the current property owner, who has been conducting site investigation and remediation activities at the site for several years. The Company submitted comments to the Regional Board on July 28, 2013, objecting to the tentative order. The Regional Board considered the matter at its regular meeting on September 11, 2013 and adopted the tentative order with only minor changes. On October 11, 2013, the Company filed a petition with the State Water Resources Control Board (“State Board”) for review of the Regional Board’s order. The State Board has not yet acted on the petition. The Company intends to vigorously defend this matter. We believe that we are, and were during the period in question described in this paragraph, in compliance with such applicable laws and regulations.

In situations where management believes that a loss arising from the above and similar other proceedings is probable and can be reasonably estimated, the Company records the amount of the loss, or the minimum estimated liability when the loss is estimated using a range and no amount within the range is more probable than another. As additional information becomes available, any potential liability related to these proceedings is assessed and the estimates are revised, if necessary. The amounts reserved for such proceedings totaled approximately $2.8 million as of September 26, 2013. Management believes any additional liability with respect to these claims and disputes will not be material in the aggregate to the Company's consolidated financial position, results of operations or cash flows.

Under ASC Topic 450, Contingencies—Loss Contingencies, an event is "reasonably possible" if "the chance of the future event or events occurring is more than remote but less than likely" and an event is "remote" if "the chance of the future event or events occurring is slight." Thus, references to the upper end of the range of reasonably possible loss for cases in which the Company is able to estimate a range of reasonably possible loss mean the upper end of the range of loss for cases for which the Company believes the risk of loss is more than slight. Management is unable to estimate a range of reasonably possible loss for cases in which damages have not been specified and (i) the proceedings are in early stages, (ii) there is uncertainty as to the likelihood of a class being certified or the ultimate size of the class, (iii) there is uncertainty as to the outcome of pending appeals or motions, (iv) there are significant factual issues to be resolved, and/or (v) there are novel legal issues presented. However, for these cases, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material adverse effect on the Company’s financial condition, though the outcomes could be material to the Company’s operating results for any particular period, depending, in part, upon the operating results for such period.

Our theatres must comply with Title III of the Americans with Disabilities Act of 1990 (the "ADA") to the extent that such properties are "public accommodations" and/or "commercial facilities" as defined by the ADA. Compliance with the ADA requires that public accommodations "reasonably accommodate" individuals with disabilities and that new construction or alterations made to "commercial facilities" conform to accessibility guidelines unless "structurally impracticable" for new construction or technically infeasible for alterations. Non-compliance with the ADA could result in the imposition of injunctive relief, fines, awards of damages to private litigants and additional capital expenditures to remedy such non-compliance.

The accessibility of theatres to persons with visual impairments or that are deaf or hard of hearing remains a topic of interest to the Department of Justice and they have announced that they will be issuing another Advance Notice of Proposed Rulemaking concerning the provision of closed captioning and descriptive audio within the theatre environment. The Company believes it provides the members of the visually and hearing impaired communities with reasonable access to the movie-going experience, and has deployed new digital captioning and descriptive video systems that should meet all such potential requirements or expectations of any federal, state or individual concerns. The Company believes that it is in substantial compliance with all current applicable regulations relating to accommodations for the disabled. The Company intends to comply with future regulations in this regard and except as set forth above, does not currently anticipate that compliance will require the Company to expend substantial funds.

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Sale-Leaseback Transactions

9 Months Ended

Sep. 26, 2013

Sale Leaseback Transactions

Sale-Leaseback Transactions

Sale—Leaseback Transactions

In December 1995, UATC entered into a sale and leaseback transaction whereby 31 owned properties were sold to and leased back from an unaffiliated third party. In conjunction with the transaction, the buyer of the properties issued publicly traded pass-through certificates. In connection with this sale and leaseback transaction, UATC entered into a Participation Agreement that requires UATC to comply with various covenants, including limitations on indebtedness, restricted payments, transactions with affiliates, guarantees, issuance of preferred stock of subsidiaries and subsidiary distributions, transfer of assets and payment of dividends. As of September 26, 2013,11 theatres were subject to the sale leaseback transaction and approximately $14.7 million in principal amount of pass-through certificates were outstanding.

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UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 26, 2013	Dec. 27, 2012
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 1.00	$ 1.00
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 1.00	$ 1.00
Common stock, shares authorized	1,000	1,000
Common stock, shares issued	100	100
Common stock, shares outstanding	100	100

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Related Party Transactions (Tables)

9 Months Ended

Sep. 26, 2013

Related Party Transactions [Abstract]

Schedule of other revenues recognized from National CineMedia

The Company’s portion of these revenues are presented as a component of "Other operating revenues" in the Company’s unaudited condensed consolidated financial statements and consist of the following amounts (in millions):

	Quarter Ended September 26, 2013			Quarter Ended September 27, 2012			Three Quarters Ended September 26, 2013			Three Quarters Ended September 27, 2012
Theatre access fees	$	0.5		$	0.4		$	1.2		$	1.2
Other NCM revenue	—			—			0.2			0.2
Amortization of ESA modification fees	0.1			0.1			0.3			0.3
Payments for beverage concessionaire advertising	(0.3		)	(0.3		)	(0.8		)	(0.8		)
Total	$	0.3		$	0.2		$	0.9		$	0.9

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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 26, 2013	Sep. 27, 2012
Cash flows from operating activities:
Net income	$ 7.1	$ 8.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5.3	6.2
Net loss on disposal and impairment of operating assets and other	1.3	0.3
Deferred income tax provision	(0.5)	0.3
Effect of leases with escalating minimum annual rentals	(1.0)	(0.9)
Change in operating assets and liabilities:
Receivables	0.8	1.1
Prepaid expenses, concession inventory and other assets	(3.6)	(3.6)
Accounts payable	(0.3)	(4.9)
Deferred revenue	(0.6)	(0.3)
Accrued expenses and other liabilities	0.3	(0.9)
Net cash provided by operating activities	8.8	5.4
Cash flows from investing activities:
Capital expenditures	(2.6)	(3.6)
Proceeds from disposition of assets	0.1	0
Distributions to partnership	(0.1)	(0.1)
Net cash used in investing activities	(2.6)	(3.7)
Cash flows from financing activities:
Debt payments	(0.2)	(0.2)
Decrease (increase) in related party receivables and other	6.3	(6.2)
Net cash provided by (used in) financing activities	6.1	(6.4)
Net increase (decrease) in cash and cash equivalents	12.3	(4.7)
Cash and cash equivalents:
Beginning of period	54.7	54.8
End of period	$ 67.0	$ 50.1

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UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	Sep. 26, 2013	Dec. 27, 2012
Current assets:
Cash and cash equivalents	$ 67.0	$ 54.7
Receivables	0.3	1.1
Prepaid expenses, concession inventory and other current assets	5.0	1.4
Deferred income tax asset	2.1	2.3
Total current assets	74.4	59.5
Property and equipment:
Land	2.7	2.7
Buildings, leasehold improvements and equipment	105.5	107.1
Total property and equipment	108.2	109.8
Accumulated depreciation and amortization	(76.6)	(74.2)
Total property and equipment, net	31.6	35.6
Goodwill	7.1	7.1
Other non-current assets	10.0	5.9
Total assets	123.1	108.1
Current liabilities:
Accounts payable	4.8	5.1
Accrued expenses and other	6.7	6.3
Current portion of debt obligations	0.3	0.3
Total current liabilities	11.8	11.7
Other non-current liabilities	4.9	1.8
Non-current deferred revenue	23.5	24.1
Long-term debt, less current portion	0.6	0.8
Deferred income tax liability	23.4	24.1
Total liabilities	64.2	62.5
Commitments and contingencies
Equity:
Preferred stock, $1.00 par value; 500,000 shares authorized, no shares issued and outstanding at September 26, 2013 and December 27, 2012	0	0
Common stock, $1.00 par value; 1,000 shares authorized, 100 shares issued and outstanding at September 26, 2013 and December 27, 2012	0	0
Additional paid-in capital	93.2	93.2
Retained earnings	54.7	47.7
Related party receivables	(89.3)	(95.6)
Total stockholder’s equity of United Artists Theatre Circuit, Inc.	58.6	45.3
Noncontrolling interest	0.3	0.3
Total equity	58.9	45.6
Total liabilities and equity	$ 123.1	$ 108.1

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Debt Obligations (Tables)

9 Months Ended

Sep. 26, 2013

Debt Disclosure [Abstract]

Schedule of debt obligations

Debt obligations are summarized as follows (amounts in millions):

	September 26, 2013			December 27, 2012
Debt obligations(a)	$	0.9		$	1.1
Less current portion	(0.3		)	(0.3		)
Long-term debt, less current portion	$	0.6		$	0.8

 ______________________________

(a)Debt obligations include $0.9 million and $1.1 million of capital lease obligations as of September 26, 2013 and December 27, 2012, respectively, which have an interest rate of 10.0%, maturing in 2016.

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Debt Obligations (Details) (USD $) In Millions, unless otherwise specified	Sep. 26, 2013		Dec. 27, 2012
Debt Disclosure [Abstract]
Debt obligations	$ 0.9	[1]	$ 1.1	[1]
Less current portion	(0.3)		(0.3)
Long-term debt, less current portion	0.6		0.8
Capital lease obligations	$ 0.9		$ 1.1
Interest rate on capital lease obligations (as a percent)	10.00%		10.00%

[1] Debt obligations include $0.9 million and $1.1 million of capital lease obligations as of September 26, 2013 and December 27, 2012, respectively, which have an interest rate of 10.0%, maturing in 2016.

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Recent Accounting Pronouncements

9 Months Ended

Sep. 26, 2013

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. Under ASU 2013-02, an entity is required to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional detail about those amounts. ASU 2013-02 became effective for the Company as of the beginning of fiscal 2013. The adoption of ASU 2013-02 had no impact on the Company's consolidated financial position, cash flows, or results of operations.

In July 2013, the FASB issued ASU 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The amendments in ASU 2013-11 require an entity to present an unrecognized tax benefit in the financial statements as a reduction to a deferred tax asset for a net operating loss ("NOL") carryforward, a similar tax loss, or a tax credit carryforward except when: (1) a NOL carryforward, a similar tax loss, or a tax credit carryforward is not available as of the reporting date under the governing tax law to settle taxes that would result from the disallowance of the tax position; or (2) the entity does not intend to use the deferred tax asset for this purpose (provided that the tax law permits a choice). If either of these conditions exists, an entity should present an unrecognized tax benefit in the financial statements as a liability and should not net the unrecognized tax benefit with a deferred tax asset. The amendment does not affect the recognition or measurement of uncertain tax positions under ASC Topic 740, Income Taxes. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. We do not expect this ASU to have a material impact to our consolidated financial statements.

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Debt Obligations

9 Months Ended

Sep. 26, 2013

Debt Disclosure [Abstract]

Debt Obligations

Debt Obligations

Debt obligations are summarized as follows (amounts in millions):

	September 26, 2013			December 27, 2012
Debt obligations(a)	$	0.9		$	1.1
Less current portion	(0.3		)	(0.3		)
Long-term debt, less current portion	$	0.6		$	0.8

 ______________________________

(a)Debt obligations include $0.9 million and $1.1 million of capital lease obligations as of September 26, 2013 and December 27, 2012, respectively, which have an interest rate of 10.0%, maturing in 2016.

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 26, 2013	Sep. 27, 2012	Sep. 26, 2013	Sep. 27, 2012	Dec. 27, 2012
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 2.4	$ 2.0	$ 4.6	$ 5.2
Effective tax rates (as a percent)	38.70%	38.50%	39.30%	39.10%
Valuation allowance against deferred tax assets	$ 2.4		$ 2.4		$ 2.4

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The Company and Basis of Presentation (Details)	9 Months Ended
	Sep. 26, 2013 theatre state screen	Sep. 27, 2012 screen theatre state
The Company and Basis of Presentation
Number of screens	476	503
Number of theatres	53	56
Number of states in which the entity operates	17	17
Number of weeks in each fiscal quarter for a 52-week fiscal year	91 days
Minimum
The Company and Basis of Presentation
Number of weeks in a fiscal year	364 days
Maximum
The Company and Basis of Presentation
Number of weeks in a fiscal year	371 days

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Litigation and Contingencies (Details) (USD $) In Millions, unless otherwise specified	Sep. 26, 2013
Commitments and Contingencies Disclosure [Abstract]
Maximum amount of payments and benefits payable and possible loss	$ 2.8

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Document and Entity Information	9 Months Ended
	Sep. 26, 2013	Nov. 12, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	UNITED ARTISTS THEATRE CIRCUIT INC /MD/
Entity Central Index Key	0000889570
Document Type	10-Q
Document Period End Date	Sep. 26, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-26
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		100
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3