716634--3/30/2007--READING_INTERNATIONAL

related topics

{cost, contract, operation}

{loan, real, estate}

{competitive, industry, competition}

{acquisition, growth, future}

{stock, price, share}

{regulation, change, law}

{product, market, service}

{tax, income, asset}

{capital, credit, financial}

{customer, product, revenue}

{condition, economic, financial}

{stock, price, operating}

{debt, indebtedness, cash}

{regulation, government, change}

We operate in a highly competitive environment, with many competitors who are significantly larger and may have significantly better access to funds than do we. We face competition from other sources of entertainment and other entertainment delivery systems. Our cinemas operations depend upon access to film that is attractive to our patrons and our live theatre operations depend upon the continued attractiveness of our theaters to producers. Adverse economic conditions could materially affect our business by reducing discretionary income. Our screen advertising revenues may decline. We face uncertainty as to the timing and direction of technological innovations in the cinema exhibition business and as to our access to those technologies. We operate in a highly competitive environment, in which we must compete against companies with much greater financial and human resources than we have. Our financial performance will be affected by risks associated with the real estate industry generally. We may incur costs complying with the Americans with Disabilities Act and similar laws. Illiquidity of real estate investments could impede our ability to respond to adverse changes in the performance of our properties. Real estate development involves a variety of risks. The identification and acquisition of suitable development properties. The identification and acquisition of suitable development properties. The procurement of necessary land use entitlements for the project. The procurement of necessary land use entitlements for the project. The construction of the project on time and on budget. The construction of the project on time and on budget. The leasing or sell-out of the project. The leasing or sell-out of the project. The refinancing of completed properties. The refinancing of completed properties. The ownership of properties involves risk. Risk of adverse government regulation. Risk of adverse government regulation. This is the first year we have generated a profit in recent periods. We have negative working capital. We have substantial short to medium term debt. We have substantial lease liabilities. The Internal Revenue Service has given us notice of a claimed liability of $20.9 million in back taxes, plus interest of $13.5 million. Our stock is thinly traded. The interests of our controlling stockholder may conflict with your interests. Since we are a Controlled Company, our Directors have determined to take advantage of certain exemptions provide by the American Stock Exchange from the corporate governance rules adopted by that Exchange.

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716634--3/30/2007--READING_INTERNATIONAL_INC