Good day, everyone, and welcome to the Ryman Hospitality Properties Third Quarter 2024 Earnings Conference Call. Hosting the call today from Ryman Hospitality Properties are Mr. Colin Reed, Executive Chairman; Mr. Mark Fioravanti, President and Chief Executive Officer; Ms. Jennifer Hutcheson, Chief Financial Officer; Mr. Patrick Chaffin, Chief Operating Officer; and Mr. Patrick Moore, Chief Executive Officer of Opry Entertainment Group. This call will be available for digital replay. The number will be 1800-839-5685 with no conference ID required. [Operator Instructions]. It is now my pleasure to turn the floor over to Ms. Jennifer Hutcheson. Ma'am, you may begin.

Good morning. Thank you for joining us today. This call may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements about the company's expected financial performance. Any statements we make today that are not statements of historical facts may be deemed to be forward-looking statements. Words such as believes or expects are intended to identify these statements which may be affected by many factors, including those listed in the company's SEC filings and in today's release. The company's actual results may differ materially from the results we discuss or project today. We will not update any forward-looking statements, whether as a result of new information, future events or any other reason. We will also discuss non-GAAP financial measures today. We reconcile each non-GAAP measure to the most comparable GAAP measure in exhibit to today's release. I'll now turn the call over to Colin.

Thank you, Jen, and good morning, everyone. We are pleased to report strong third quarter 2024 results. Our same-store hospitality segment delivered record third quarter revenue and adjusted EBITDAre driven by continued strength in our group business. And our entertainment business delivered record third quarter revenue driven by continued momentum in our Ole Red brand. During the quarter, we continued to make progress against our major capital investment initiatives. And with many of our 2024 projects nearing completion, we are more excited than ever about the value this will create for our shareholders in the years to come. Mark will review the third quarter in more detail in just a moment. But first, I'd like to remind you how we think about some of these exciting improvements. As we first shared with you at our Investor Day, in our hospitality portfolio, we are focused on continuing to grow our business through investments that are customer informed and replicable across the portfolio, resulting in at least mid-teens unlevered returns. This year alone, we've undertaken a significant portion of the more than $1 billion capital program. And the early results of these efforts are beginning to show in our bookings production for '26 and beyond. Now the strategy sounds simple. One, we build demand; two, we provide the customer with great service; three, we retain the customers and then move them across our system and then further enhance and expand the product and generate superior returns on the capital we deploy. But in reality, it's taken years to perfect this strategy, but our superior TSR is because of this disciplined approach. At the Gaylord Rockies, we've completely repositioned the entertainment spaces with beautiful sellable space that seamlessly bridge the indoor and outdoor spaces. We've also increased our food and beverage outlet seat…

Thanks, Colin. Good morning, everyone. I'll provide a review of the third quarter, highlight some of the trends we're seeing in our business and discuss our revised guidance ranges before handing it over to Jennifer to cover our financial position and outlook for capital expenditures. Both our businesses continued to perform well in the third quarter. We finished the quarter with consolidated total revenue of $550 million, a third quarter record, up 4.1% year-over-year and record third quarter consolidated adjusted EBITDAre of $175 million, up 2.3% year-over-year. Our same-store hospitality segment delivered year-over-year RevPAR growth of 2.1% and total RevPAR growth of 4.2%. ADR of $245 was a third quarter record, up 6.2% year-over-year driven by record third quarter rate in both group and transient. Same-store hospitality adjusted EBITDAre of $142 million was also a third quarter record. Same-store hospitality margin increased 30 basis points year-over-year to 34.4% despite a $4 million year-over-year reduction in attrition and cancellation fees which flow through to profitability at 100% after management fees. Leisure transient softness in the Nashville and Orlando markets continued into the third quarter. However, continued solid group performance, robust out of room spending and operating efficiencies more than offset the profitability impact of leisure declines, again, demonstrating the merits of our group-centric model. In the quarter, same-store group rooms revenue was a third quarter record, up 6.8% year-over-year. Banquet and AV revenue was also a third quarter record, up nearly 16% and on higher contribution per group room night travel. Catering was particularly strong at Gaylord Opryland, Gaylord Palms and Gaylord Rockies. Foundational to our differentiated business model are all-under-one-roof offerings are uniquely positioned to capture out of room spending and drive market share gains relative to our competitors. We continue to see it in the numbers. Since the third…

Thanks, Mark. We ended the third quarter with $535 million of unrestricted cash on hand and our $700 million revolving credit facility undrawn. OEG's $80 million revolving credit facility had a balance of $16 million outstanding. Taken together, our total available liquidity was approximately $1.3 billion, net of approximately $4 million of outstanding letters of credit. We retained an additional $36 million of restricted cash available for FF&E and other maintenance projects. At the end of the quarter, our net leverage ratio based on total consolidated net debt to adjusted EBITDAre was 3.8x. We continue to have the flexibility and liquidity to support our capital allocation priorities, and the continued growth of our business. To that end, we are pleased to announce the declaration of our fourth quarter dividend of $1.15, payable on January 15, 2025, to shareholders of record as of December 31, 2024. This represents a 4.5% increase in our quarterly dividend and a 4.2% yield based on yesterday's closing price. It remains our intention to continue to pay 100% of our REIT taxable income through dividends. For the full year 2024, we expect to invest capital of approximately $400 million to $450 million. As both Colin and Mark discussed, much of our 2024 major capital activity is nearing completion. In our hospitality business, at Gaylord Rockies, the final phase of the Grand Lodge repositioning, which includes several additional food and beverage outlets will reopen at the end of this month. Phase 1 of this project, which opened in May is already driving incremental out-of-room spend. At Gaylord Opryland, the repositioning of the currently underutilized Magnolia Courtyard into a new sports bar complex, including a group pavilion and event launch space is well underway. We expect to complete this project in early 2026, and Marriott sales teams are already selling into these improvements. Renovation of the governor's ballroom there and pre-function space is also progressing well, and we expect to complete this work in early 2025. Renovation of the presidential ballroom and pre-function space is scheduled to begin later this month. At the Gaylord Palms, we expect to complete the final phase of the lobby renovation by year-end and the rooms renovation in the first quarter of 2025. As Colin mentioned, when these projects are completed, nearly every [indiscernible] group facing aspect of the property, will have been refreshed within the last 4 years, positioning the property well as growth of the Orlando market reaccelerates. In our Entertainment business, both major projects have at least partially reopened to positive early reception. At the W Austin Hotel, the public space and food and beverage concepts have reopened and the rooms renovation is expected to be completed by year-end. Finally, as Colin mentioned, our first venue under the Category 10 brands soft opened over the weekend. The construction on the rooftop is ongoing and will complete in the first quarter of 2025. And with that, David, let's open it up for questions.

[Operator Instructions] We'll take our first question from Patrick Scholes with Truist.

Good morning, everyone. Thank you. A couple of questions here. It looks like in your full year guidance, CapEx is going up. Can you talk a little bit what is driving that? And then I have 1 or 2 more questions.

Sure. It is a modest increase in terms of the base of spending that we're estimating now a $400 million to $450 million range. And really, that's more a function of timing of the cash spend. We've not added any incremental projects or changed the scope of projects that's caused that to increase nor have the budget estimates for our individual projects materially changed. Again, this is just largely a function of the timing of the cash payments, whether we're carrying into this year or carrying into next year.

Okay. And then on a similar topic, I've been reading some media reports about potential expansion at your Colorado property. Anything you can give us some color on that. And related to that, what type of ROIC would you target from that? It seems like it would be sort of a pod add-on to an existing property. So what do you target with that?

Well, they were all mid-teens. That was -- Patrick, Morning, Colin. Pat, we've done like 3 big projects there. All of them are mid-teens. So you want to just give Patrick Scholes a little bit of color.

Sure. Yes. To Colin's point, our internal rate of return, we're targeting to be in the mid- to high teens. The Grand Lodge revisions are at that level or higher. The group pavilion that we just opened, which both assets are meeting great success and exceeding pro formas thus far, were both in the mid- to high teens. From an expansion perspective, we've made it very known that we would like to expand that property. And we continue to explore that, and we'll be having conversations with our Board of Directors in the coming months around potential expansion.

And the reason -- and Patrick, the reason, Patrick Scholes, the reason why we are going to talk to our Board about this is when you look at the business on the books, across our portfolio, this is the hotel that sticks out with having the most room nights on the books for 20 -- as a percentage of available for '25, '26, the numbers look really, really strong for the Rockies. So we're very excited about this long term, this particular building. And I think you've heard us say before, there's no reason over time why this building can't morph to something that physically looks like Opryland. And -- when you look at the geographic positioning of this hotel, the airlift, the customer reaction, I think over time, this thing -- this hotel can do extremely well for us.

The only thing I was going to say is, Patrick, that hotel when it originally opened had meeting space to carry the expansion. So we won't have to add additional meeting space. And with the most recent capital investments we've made, we've added about 650 food and beverage seats in that hotel. So it will have the food and beverage capacity as well.

Okay. So I mean are you talking ballpark 200 rooms, maybe 1,000 rooms? Or is it too early to give us?

Patrick, this is Patrick Chaffin again. What we’re looking at right now is potentially a 2-phased expansion. The first expansion would be around 450 rooms. And if that stabilizes and performs the way we would expect, we would come back and do a second expansion down the road when it makes economic sense based on how the first expansion performs.

We'll take our next question from Chris Woronka with Deutsche Bank.

So really, really impressive rate performance in the quarter and also on the forward. And my question is, we obviously lost a little bit of [indiscernible] in Q3, and I know that might be related to leisure. The question though is, are you at a point where you begin to consciously trade a little group OC in favor of rate? And I know there's another component to that, which is the out-of-room spend, but I'm just curious as to whether we should expect maybe slightly lower OC levels at the next peak, but with much better rate growth than we've seen in the past.

Well, I mean our goal is still, obviously, to get these hotels to an aspirational 80% occupancy running consistently. But to your point, Chris, coming out of the pandemic, we've really focused on driving the rate because with the capital investments that we made, we feel like we're delivering the value to the customer and the customer is responding to these enhancements, and you can see that in our bookings. So ultimately, we're trying to drive and maximize our RevPAR and total RevPAR in the yield of the hotel. But I don't -- I wouldn't necessarily assume that, that means that we ultimately peak at a lower occupancy rate. We're in a segment that has very limited supply growth and demand continues to grow. And when you look at our assets and how they're positioned relative to our peers, we're in a pretty good position.

Chris, this is Patrick. The only thing I'd add to that is I would point out that we've only seen a couple of months post pandemic where demand levels got back to where they were pre-pandemic. And so you weigh that against this type of rate and occupancy, future room nights that we're putting up and we're extremely pleased with how the sales teams are doing in driving room nights and especially rate. And as that demand continues to build back to where it was pre-pandemic, to Mark's point, we think we're going to have the best of both worlds where you have strong rate performance based on the improved value proposition from these investments in hotels as well as similar or even better occupancy performance.

Okay. Very good. I did have a quick follow-up, which is I think there's been a lot of -- so San Diego, [indiscernible], right, you're getting closer to come across the finish line. And just curious as to whether there's any updated thoughts on whether that's something -- your messaging has been pretty clear in the past that it can only be on the table if certain conditions are there. I'm just curious as to whether any of the conditions you look at are more likely or less likely than our last update.

You do it. But I mean things haven't changed.

Yes. I mean our position relative to our participation in that asset really hasn’t changed. I would say that again, as they move closer to opening and continue to sell that hotel, we’ve not seen any cannibalization in our production numbers. And in fact, we’re seeing room nights and groups that are originating their booking into our part of the portfolio at a rate premium. So the operationally and how that hotel relates with the increased distribution of the San Diego market, its performance as it relates to the overall portfolio is kind of unfolding as we thought it would because it’s consistent with what our experience has been historically when we’ve opened other properties. But in terms of us participating in our view at this point hasn’t changed.

We will take our next question from Smedes Rose with Citi.

I just wanted to ask you a little bit more about some of the leisure trends you're seeing in the fourth quarter. I think on your last call, you talked about maybe some weakness or the lower end consumer, but the higher end consumer was maybe hanging in there. And I just kind of interested in any discussion around kind of any changes you've seen to that customer?

Well, Smedes, as you know, our fourth quarter is very leisure centric. It is the biggest quarter of the year from a leisure demand perspective. Patrick, you want to give Smedes a little indication of what we're seeing on the fourth quarter.

Sure. Smedes, let me start by saying that the trends that we've seen all year long continue. Dallas, Denver, Washington, D.C. are all doing okay from a transient perspective. San Antonio is doing well. The opportunity has always been primarily in the Orlando market with some spillover into the Nashville market. The Orlando market continues to see the greatest challenge, a lot of speculation in the market is the result of the fact that a lot of folks believe that this is the consumer waiting until Universal Studios opens their new theme park Epic next year and that, that's creating a drain currently on the market. Those trends have continued staying in the same segments that we've been seeing previously. From our perspective, the metrics that we can look at as really lead indicators of how the fourth quarter transient performance will actualize. ICE tickets are pacing right at our expectations and have held pretty steady. Now we've only booked about 15% of the total tickets that we expect to book for the quarter, but early indicators are that we're doing exactly what we believe we will be able to do. From a transient room night packages perspective, we're pacing largely in line with our expectations. So we've built in lower expectations on the transient side that's reflected in our guidance based on the trends we've seen primarily in Orlando, somewhat in Nashville. And we are thus far holding at those expectations. Now we'll caution you just to say that a lot of ICE packages and tickets are booked within 30 days of arrival, and even greater portion are booked within 7 days of experiencing the event. So we'll continue to watch it closely. But right now, we believe that our guidance and our forecasts are in line with what -- where it will actualize for the quarter.

And then I just wanted to follow up, Mark, you mentioned, I just wanted to make sure I understood that right. Not only is Chula Vista not impacting any of your group bookings and cannibalizing, but you -- it sounds like you think it's in fact, benefiting your group bookings going forward?

Yes. I mean thus far, we've picked up about a little over 200,000 room nights that have rotated into the portfolio that originated from Chula Vista. So we're seeing that -- we're seeing that behavior again. When you look historically, though, what typically happens is that those people who experience the brand in a new location like that, once they've experienced it then they book rotational business. So you would expect that percentage to increase over time as people experience the asset and the brand.

This is exactly what's happening in Colorado.

Colorado and also the same thing happened in Washington, D.C.

And just to put a fine point on it, those roughly 200,000 room nights that have booked into Pacific and driven those 200,000 additional room nights for the rest of the brand have come in at about a 9% premium on ADR versus other multiyear programs. So we’ve talked about this in the past when you enter into the brand and the gateway market with high rate like San Diego, those groups have a higher propensity to book through at a much higher rate. So we believe that will benefit the entire portfolio and the Gaylord brand long term.

We'll take our next question from Dori Kesten with Wells Fargo.

Based on your expectations for Q4 group bookings, what group revenue pace would you expect to enter '25 with from the 2% today?

Dori, I don't know that we are prepared to give that level of granularity. I will tell you that we are expecting -- we had a historic second quarter. Third quarter came in exactly where we expected it to, given the fact that we had the second best production and revenue quarter for our second quarter ever. And we just finished October. October came in at the best October ever, both in terms of rate with the highest rate ever achieved for forward bookings and the highest October production in the history of the portfolio. So we'll watch November and December closely, but I would tell you from a funnel perspective, lead volumes are very, very promising, and we believe we'll turn in a really solid performance, both on occupancy and on rate. Where we stand right now, year-to-date, I will tell you that it's the best revenue on the books ever in the history of the portfolio by $45 million over the next best performance. So we feel really good about where bookings are going to come in. And 2025 does have the impact of some disruption from work going on at Opryland and Texan, but we're going to manage through that very effectively and believe we'll turn in really solid '25 based on how bookings are pacing.

Okay. And then just on that, can you provide a little bit more context on renovation headwinds versus tailwinds that you would expect next year? And then I guess, I think there's been about maybe $10 million to $12 million of headwinds in entertainment. Would you expect those to fully reverse? And then I guess on top of that, it's the 100th anniversary that you'll receive more tailwinds for. So just provide some kind of context around the headwinds and tailwinds we should think of next year.

And to table wise, we will have basically 0 disruption next year. And I suspect that when we deliver our guidance to you in February, you'll see decent year-over-year growth in entertainment. The hotel business will also show growth next year, year-over-year. And -- but as Patrick Chaffin said, that we do have this major refurbishment at the Texan and also this transformation that's underway at Opryland that will absolutely pay huge dividends in '26 and '27. And I think Mark said it when he did his piece, the room nights on the books and revenue on the books for T+2 right now is tracking 10% up. As we come out of this refurbishment program that we're going to be doing, which we are underway right now in our hotel business and also next year as we come out of that, the lift will be very, very good.

No, I think that’s right. And just to again put a finer point on that. The data that we have given as of right now is what’s on the books for T+1, T+2, T+3 in terms of contracted rooms revenue. And again, we point to the fact that we did declare a $0.05 increase in our quarterly dividend, and that has read through implications in terms of our expectations for the free cash flow that we’ll generate next year.

We'll take our next question from Shaun Kelley with Bank of America Merrill Lynch.

I wanted to go back to Patrick's discussion, if we could, on just the leisure point and really just a clarification, but I'm still trying to get my arms around a little bit of what changed exactly on the leisure outlook. I mean as we go back to maybe April of this year, I think that's when you started to kind of comment that leisure was coming in a bit weaker. Was it really that we just didn't derisk in the fourth quarter and maybe there were higher expectations that ultimately actualize that things will rebound? Or was it something else that was kind of different than expected? Because again, you said, the behavior is not that different than what you've been experiencing, but clearly, that's a big enough change to impact the outlook here.

Yes. I mean we've continued to see, I think, softness as we've moved through the year. To your point, it started really in the spring. And then as we moved into summer, we saw some increases. As it relates to the adjustments to the guidance, it's really -- there's really 3 components there. A portion of it is leisure, but we also have some incremental disruption, and we also have the impacts of Hurricane Milton. So they're really kind of almost 1/3, 1/3, 1/3 when you break the numbers down. So it's not -- the guidance change that we're making as we look at the rest of the year is not strictly the leisure.

No. And look, the reality is that we're going to -- when you look at our guidance for the year, and you dissected for the fourth quarter, the fourth quarter is going to show good growth over the fourth quarter of last year. The world is not falling apart here. These are rounding errors that we're trying to be very precise in laying out what we expect to happen in the fourth quarter. And as Mark said, this is -- the modification that we're making to EBITDA is de minimis. It's -- when you look at the year-over-year growth of our company, this is a minor modification. And there's really no real substantive change in our thinking about leisure trends and group trends, which are tremendous.

The other challenge for us is Q4 is so heavy leisure and it's where we have the least amount of visibility. As Patrick mentioned, most folks are booking within 30 days. So we're sitting here today with about 15% of the business on the books. And -- so we're trying to be mindful of the risk and appropriately provide the right level of guidance.

And then just as a follow-up, and I know I think people have kind of hit on the bridge for next year a little bit in terms of a question earlier about sort of group -- the pace that you've got on the books. If we just think about the operating cost outlook, we're starting to kind of get into that season where people are formulating budgets. Just what are you seeing out there on the kind of labor side, in particular, for your model and for your markets? Kind of what do you think is the right general inflationary range to be thinking about in operating expenses next year?

That's a good question. You want to take the hotel side, Patrick, breakdown between Union and nonunion and what we're seeing.

Yes. So to Colin's point, we have one Union hotel. I'm happy to report that we have finalized our negotiations with Level 25. The agreement has been ratified. So we have a new collective bargaining agreement in place. We're pleasantly -- we're pleased when we say that, with the results, it's about a 6% CAGR over the course of 4 years. So we feel that our long-range plan and our expectations for next year fully have comprehended that growth in labor wages. On the nonunion side, we are going through the budgeting process with Marriott right now. but a much more moderate growth rate than what we've seen over the past few years. So we feel that we've made the appropriate increases in '20, '21, '22 and '23, and finishing up here in '24 that '25 will not see quite as steep of an increase on the wage side. So I'll give you more color when we get to February and we finalized the budgeting process with Marriott, but we feel great from a union perspective, that we've got it locked in and the nonunion side, we don't see any significant surprises and a much lower level of growth in wages than what we've seen in the past few years.

Would you also Patrick comment here to Shaun on what has happened margin-wise in our hotel business over the last couple of years? Because even though we've seen this wage pressure, we've been able to increase the margin of our business materially because we've dealt with more and more efficiencies. So maybe you could just comment on that, too.

Yes, there were two things I would call out to that. Number one, we've done a phenomenal job, and I really want to complement revenue management teams as well as the sales teams in driving both leisure rate and you're seeing more and more of the group rates show up. And that puts us in a great position to absorb a lot of these wage increases successfully and still drive margin. The second to Colin's point, is we improved our wage margin even as wages were going up. So we became more and more efficient. We did that both on the management side as well as the nonmanagement side. So we held Marriott's feet to the fire and they proved to be great partners in helping us reassess and rationalize all of our management positions and hold to an agreed-upon level as far as how many to add back post COVID. And we -- I think it's fair to say we've taken great care of the stars and so we've been able to gain additional efficiencies even as wages have gone up. And so both in terms of room rates and efficiencies gained in the business with the management and nonmanagement side of the business, we've been able to drive margin.

At the midpoint of our guidance, we're growing year-over-year, our margin for same-store will be up 70 basis points, and that's on a midpoint RevPAR growth of 0.5 point and 3%. So the margin management has been very, very good. The team has done a terrific job.

And I would add to that, we identified in early January that transient was going to be soft. And so worked with the properties to start putting in place profit improvement plans, some long term, some short term, but to make sure that we were continuing to manage the business very, very closely in light of short-term headwinds, and that has paid great dividends for us.

If I may, I just want to add one last comment. Shaun, you’ve been around with us for quite a while. And you will have heard over the years, Mark and I talk about we want to get this business, this hotel business at a sustainable 35% margin. And we were on a tear to get that done pre-COVID, COVID obviously not for sideways. But when you look at the consolidated EBITDA of our company in ‘22, we were 33%, in ‘23, we were at 34.2%. And if you look at sort of the midpoint of our guidance, as Mark said, we’re pushing 35% margin. So all of this wage stuff, I think our teams have done, both in our entertainment business and our hotel business a really good job.

[Operator Instructions] We'll take our next question from Jay Kornreich with Wedbush.

As you're getting those robust group bookings into future years that you outlined, can you just comment on kind of the demand segmentation you're experiencing and where you've been able to push rate the most from among corporate associations and some customers?

Yes, I would tell you that our focus has been across the board. And so going to give you a couple of examples. Obviously, on the corporate side, that is probably where you have the greatest success. It's not the harder sell. A little bit tougher on the association side. But I would tell you that we've -- we've made some really tough decisions in the past 3 years and said goodbye to some of the [indiscernible] groups and some of the associations by sharing with them that given the value proposition improvements from all the investments we've talked about, rate was going to have to go up for some of these groups that were maybe lower rated. And we have parted ways with a few groups and told them they take a look around and if you can find a better value proposition for what we offer for a rate that's as low as what you're asking, good luck to you. And some of those groups have gone their own way. Some of them actually have come back to us. So it is a full court press, both on corporate association and on SMERF you obviously have tremendous success on the corporate side. It is the easier sell, but we've had great success both in association and SMERF because we have made some tough decisions, recognizing our own value and how that's improving with these investments.

And Jay, one of the ways to manage this with some of the more rate-sensitive groups is what date they travel one. So it's not just -- it's not a consistent rate, obviously, for every travel pattern. And -- and so one of the things that the sales teams do is work with these more rate-sensitive groups to hopefully accommodate them during a travel pattern that works for us as well.

I want to add something here. I want to give you Patrick Chaffin and your asset management folks, I want to give you a shout out here because I'll give you one example. We've had a group here at Opryland. I'm not going to tell you which it is. Well, we've had a group here at Opryland that's been with us for 20 years, and they basically fill up [indiscernible] for 3 days in March. And it's an association, and they have historically been low rated. And they started to choke when we pushed a new rate structure for them. Patrick Chaffin brought the CEO of that association here into Nashville. And we spent a couple of hours educating these folks on all of the work that we have done at this hotel, the millions and millions of dollars of investment to upgrade the quality of the hotel and make it a better experience. At the end of the day, this group just booked 20,000 room nights with us in the month of October. But our team has been individually working with these long-standing groups to educate them on the transformation that has taken place within our properties. So shout out to Patrick and his team, but they played a big role here in the continuation of this rate growth.

So Jay, just to put one final point on this. If you look at through September, year-to-date rate growth in production that was booked for this year for all future periods, Corporate Association and SMERF have almost the identical growth rate and rate for everything that's been booked this year for all future periods. So again, it's a full court press on all fronts. And we are very pleased with how the sales team has hit all of them appropriately with this improved value proposition from the investments.

Great. Appreciate all the color. And then just one follow-up going back to the entertainment side. It looks like there's some sequential softness in the third quarter on EBITDA and margins. And so just curious if you can expand on maybe what that was attributed to and if you expect a pickup in the fourth quarter.

Well, some of the sequential softness you're looking at is sort of the disruption, the $8 million to $10 million of disruption related to the Wildhorse being closed this year versus being opened last year. And then we have the W Hotel disruption as well. So those 2 components were predominantly the reasons for some of that change on a year-over-year basis in the third quarter.

Okay. So I guess it's fair to say that the third quarter came in with where you were expecting it to? And then just following up on that, do you expect fourth quarter to be a bit better, especially as the [indiscernible] has now opened up?

Yes. No, we're very excited about the opening, as Colin mentioned, of Category 10. It opened up extremely well and above our expectations. It's obviously just a few days open, but Luke Combs is a fantastic partner, and that building that multifaceted entertainment concept is incredibly unique and distinctive relative to any other property on Broadway or in the market. So we're incredibly encouraged by the potential of that particular asset.

David, if there are any more questions, we’ll take one more. If not, we’ll shut it down.

And there are no further questions on the line at this time. I return the program to you.

Excellent. All right. Well, thank you, everyone, for taking the time this morning as the team articulated. The business is in really good shape, and we look forward to getting through the next couple of months as we close the year out and then articulating ‘25 and beyond. But thank you, everyone. And if you have any further questions, you know how to get hold of us. Appreciate it. David, thank you.

And this does conclude today's program. Thank you for your participation, and you may now disconnect.