Good morning, everyone, and welcome to The Marcus Corporation Third Quarter Earnings Conference Call. My name is Victor and I will be your operator for today. At this time, all participants are in a listen-only mode. We will conduct a question-and-answer session towards the end of this conference. [Operator Instructions] As a reminder, this conference is being recorded. Joining us today are Greg Marcus, President and Chief Executive Officer; and Doug Neis, Chief Financial Officer of the Marcus Corporation. At this time, I would like to turn the program over to Mr. Neis for his opening remarks. Please go ahead, sir.

Thank you, Victor, and welcome everybody to our Fiscal 2017 Third Quarter Conference Call. As usual, I will begin by stating that we plan on making a number of forward-looking statements on our call today and those forward-looking statements could include but not be limited to statements about our future revenues and earnings expectations, our future RevPAR; occupancy rates and room rate expectations for our Hotels and Resorts division; expectations about the quality, quantity and audience appeal of film product expected to be made available to us in the future; expectations about the future trends in the business group and leisure travel industry and in our markets; expectations and plans regarding growth in the number and type of our properties and facilities; expectations regarding various non-operating line items on our earnings statement and our expectations regarding future capital expenditures. Of course, our actual results could differ materially from those projected or suggested by our forward-looking statements. Factors, risks, and uncertainties which could impact our ability to achieve our expectations and they are included in the Risk Factors section of our 10-K and 10-Q filings, which can be obtained from the SEC or the company. And we’ll also post all Regulation G disclosures when applicable on our website at www.marcuscorp.com. So with that behind us, let’s talk about our fiscal 2017 third quarter and first three quarters. Probably the worse tax week in the world was at the third quarter. It was a challenging quarter for movies and it certainly was not different for us. However, despite what has been a past couple of seven quarters in a row, thanks to an outstanding first quarter, we’re sitting at third quarter’s mark of fiscal 2017 with consolidated revenues up 14.7%, consolidated operating income up 7.2% and consolidated net earnings up a nearly…

Thanks, Doug. I’ll begin by remarks today with our theater division. Doug did a good job recapping some of the key third quarter numbers and I’ll give you a little more color. But as you could imagine our focus is on what lies ahead of us, not on the months that are now in our rear view mirror. The stories of third quarter is real pretty simple. Film product was just not as good as last year, and when that occurs in July and August, two prime summer months, the negative impact on operating income is not particularly surprising. In fact, given the amount of fixed cost inherent in our business, our theater management team led by Orlando Rodriguez deserve a lot of credit for effectively managing our variable cost as well as they did and driving additional business to our feeders with the tools that are disposal that we can control in order to lessen the impact at the reduced box office. Of course, a bad July and August coming on the heels of a weaker than expected second quarter led to the inevitable articles written about the future of the movie theater business. Until of course a scary com movie was released in September and turned it around once again, customers returned to the theaters and drove during the month that is typically the weakest month of the film year, proving once again that when Hollywood releases good movies, good things happen at the box office. And we can easily get lost in the shuttle is the fact that we had a record first quarter this year contributing to a 13.5% increase in year-to-date operating income from this division. You heard us say this before, it's very hard to predict in advance which quarters will be up and…

[Operator Instructions] And our first question comes from Eric Wold from B. Riley and Co. You may begin sir.

A couple of questions. You mentioned that 50 of the screens were out of service during the quarter due to the renovations. I'm assuming a much lower percentage will be out there in Q4 given the slate give a sense of what that could be or what we should assume in 2018.

Well in October, which is the beginning of Q4, we’re still in that same general range as it related to the Marcus Wehrenberg theaters. As we mentioned in the call, Eric, where our goal is that we accelerated our whole plan of the Marcus Wehrenberg theaters in order to try to be ready for a bunch of the pictures are coming out in November. So we still have what really is the equivalent of couple of - we got four or five auditoriums per locations or more in some situations and you add them all up, we’ve got the equivalent of two full theaters basically still down in October at Wehrenberg. But you’re right, once we hit November, we’ll still have, as Greg mentioned in his comments, we will have a couple of theaters that will continue on until the end of the year, but it will certainly will start to decline once we get November.

But to be clear just to make sure Marcus correct, the 15% only applies to the Marcus Wehrenberg status screen. That’s not the overall percentage.

Correct.

Okay. And then on the hotel side, congrats on the news on the Atlanta sale. I guess Atlanta of first think about your own strategy to sell your own hotels. Obviously that was not opportunity cost of Wehrenberg transaction to do a diverse -- that has not occurred. You maybe talk about just see the environment out there, buyers versus sellers in terms of where we get something done that we’re still also looking for opportunities for minority interest ownership and hotels along with management contracts, just trying to understand that the valuations and the industry given on the buyer side having integral time on the seller side so much.

Sure, let me take it backwards. First your last question about, are you still looking for minority interest where we make acquisitions and that’s absolutely in that -- as you can see that, that strategy worked. So that is one that we continue to focus on. As it relates to hotels for sale, we continue to be out in the market, we’ll watch in the market. The market is - it is still a disconnect that we haven’t seen the pricing that we want to see yet, and -- but we continue to look forward and we’ll take advantage of it when we can.

Okay. And then lastly, it’s general question, obviously a lot of press out there on movie path and subscription programs, what is your view on subscription program in general that’s something you will consider implementing markets on its own or should - over the third-party with revenue share deals with concessions or omissions or even something you consider?

Well it’s hard to make a comment on movie path because I don’t have access to their numbers and what are they doing and know how it works. In terms of I mentioned a model, we can I think read in the press. You know look that we have to watch all the pricing models and I think that the comments that they made originally when you talk about the certain price point the customers are going to do the math and we end up with a very soft customers and we can bear out because as you know we are a pretty forward fixing company and we tested our own subscription services in some certain markets probably four years ago, maybe five years ago, and it’ll be soft very differently we were at about $30 to $35 a month, was that we were able to raise start selecting group and we weren’t winning that bet, which is highly didn’t extending. Now the lower price point, I'm not sure with that model go. It's up for us to watch it. But you bring up a very important point which is -- would you like to do it yourself or with the movie path and frankly I go back to its one of the benefits of our loyalty program. For the first time, in 82 years, it was really once now there was a [indiscernible] for few years, but for almost 80 years we didn’t who was walking in the door. We now know and we believe that that knowledge is power and we think it's very important to make sure that preserve and manage and own that relationship with our customer. And I can't tell you the number of people who would like to get in the middle of that, movie passed clearly is one of them. So I think it's up to us as a company and up towards the industry to be thoughtful and very careful about how we manage that relationship because I think its very important to us and will be important to us in the future.

[Operator Instructions] Our next question comes from the line of Jim Goss from Barrington Research. You may begin sir.

IMAX just had a call on which they talked about the strong performance they had in September, especially relative to and the latest quarter out over the industry. I'm wondering if you can pick out just how well your own PLS screens paired relative to the rest of your stabled screens, then both of you mentioned it, of course. Is there any way to look at that performance through set of your overall performance?

Jim, we don’t not have numbers that - not on my are fingertips so I can through at you, but there is no question that performed very well on our large format screen. As you heard, we reported a national increase in our average ticket price this quarter and certainly September had a big part of that because of two fold. In my prepares I mentioned the fact that okay, you had some mix of pictures and so you had a out rated picture being a number one film and so certainly by definition your ticket mix is going to skew towards to higher price. But then -- and I didn’t mention but you have actually -- I think you have [indiscernible] the fact that large format screens were key element of our success certainly contributed to that as well. And we absolutely benefited from that picture playing on the large format screens and you heard. I mean we had -- for some time now we have had a pretty significant focus on expanding our number of large format screens. There is no exact statistics out there in the industry but I haven’t found anybody that has a higher percentage of large format screens than we do in our circle in terms of complex has been at least one large format screen. So we think that’s very key going forward, if at you at these next two months, and then look we have had a strong push to try to even get more open and more converted because when you get these big pictures coming up the way we do in November December, that’s where the customer loves to see the picture. And so it’s a pretty big focus for us no question about it.

In terms of financial results covering out those, do you try to analyze those screens relative to the rest of your?

Oh, we do. We don’t share that publicly, but obviously IMAX sets their business and so we see if we can get those direct numbers from them, but so we certainly do our own internal analysis but I’m not prepared to share any numbers with your today.

Okay. And in terms of competitive situation, AMC just announced it was going to build an auditorium or a set of auditoriums in Orland Park not very far from you’re a pretty significant property of yours, and not to just talk about that situation, but how have these competitive situations been working out for you specially as the receiving initiatives have become more important?

Jim, that’s a great point that you’re bringing up in the end. Yes, we noticed that announcement. For us and what we’ve been very good about, and yes, we’re going to see competition in our market. There is not doubt about it, but the team has been very focused on it and we had a strategy from day one has looked at let’s make sure that we keep our fingers as competitive as possible and to just to makes sure that we minimize that there is this kind of disruption, and I would tell you that these that that’s what we’ve done and that’s why our asset base is as strong as it is and where we’ve gone up against them, we win. And so it’s going to be, it will be a battle and then we’ll win the battle. But it is something that we have got our eye on and we’re focused on intently.

All right. So the last thing I would raise is dynamic pricing, ticket pricing, regal raised in conjunction with Adam Tickets earlier this week. Have you been looking at that aspect and is that something you would to experiment with as well?

Well, as you know we are a forward-thinking company. We’re always trying to think about where the industry is going and you could take the position that variable pricing is something that we’ve been involved in now for a while, especially if you think about our $5 Tuesday program in a variable pricing can take many forms. It can be pricing based on the day, it can be pricing based on the film. Now we obviously haven’t been doing a based in the film but we are doing it based in the day that we think we’ve had success. I think what that points to and I think that’s Regal things points to as -- why has our $5 Tuesday program worked? And I talked about this before, the reason it has worked because we’re not cannibalizing really much business out of our weekend business because there is a certain group of customers that had left the theater because you now people forget. And I think Hollywood sometimes forget that the laws which supply and demand do apply to our business, and the more supply you pump into the ancillary markets at a very low price which is what happens. Netflix, I don’t know what the cost per view on a streaming service is? But its slow as you pump supply into the low-price downstream you will ultimately impact upstream what’s happening and I think that it would be naïve for anyone who is thinking about how the model should look like to think the moves they make will only have a isolated impact on what they are doing. They impact the entire chain. And so $5 Tuesday was in an essence of rear action to what has been going on over a number of years. And so what Regal is doing is continues to show that there is going to be reactions to what is going down in our industry, we don’t exist in isolation. Now the good news is that our variable pricing model by day the week has been very successful. And so we watch it and we resumed very intently and we assume were things done.

[Operator Instructions] And at this time it appears there are no other questions. I would like to turn the call back to Mr. Neis for any additional or closing comments.

Well, thank you, everybody, for joining us once again. We look forward to talking to you again this time in February, when we release our fiscal 2017 fourth quarter and year end results. Until then, thank you. Have a good day and go see a movie.

Ladies and gentlemen, that conclude today’s call. You may disconnect your line at any time. Everyone have a good day.