John C. Merriwether - Vice President-Investor Relations Craig R. Ramsey - Chief Financial Officer & Interim President and Chief Executive Officer Michael W. Zwonitzer - Senior Vice President-Finance & Head-Investor Relations, AMC Entertainment Holdings, Inc..

Eric O. Handler - MKM Partners LLC James M. Marsh - Piper Jaffray & Co (Broker) Benjamin E. Mogil - Stifel, Nicolaus & Co., Inc. Barton Crocket - FBR Capital Markets & Co. David W. Miller - Topeka Capital Markets Michael Hickey - The Benchmark Co. LLC Chad Beynon - Macquarie Capital (USA), Inc. Jason Bazinet - Citigroup Global Markets, Inc.

(Broker) Eric Wold - B. Riley & Co. LLC James C. Goss - Barrington Research Associates, Inc..

Greetings and welcome to the AMC Entertainment's Third Quarter 2015 Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. I would now like to turn the conference over to your host, John Merriwether, Vice President of Investor Relations. Thank you. You may now begin..

Thank you. Good afternoon, everyone. I'm John Merriwether, Vice President, Investor Relations, and I'd like to welcome you to AMC's third quarter 2015 earnings conference call.

Before we get started with our prepared remarks, I'd like to remind everyone that as referenced in our press release issued earlier today, we have posted a CFO commentary on the Investor Relations page of our website at amctheatres.com. We routinely post information that may be important to investors in the Investor Relations section of our website.

We use this website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. And we encourage investors to consult that section of our website regularly for important information about AMC.

Investors interested in automatically receiving news and information when posted to our website, can also visit the Investor Relations area of our website to sign up for email alerts.

I'd also like to remind you that some of the comments made by management during this conference call may contain 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.

Forward-looking statements are subject to risks, uncertainties and assumptions and are discussed in our public filings, including our most-recent 10-K. Statements made throughout this presentation are based on current estimates of future events and the company has no obligation to update or correct these estimates.

Listeners are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainty, and that actual results may differ materially as a result of these various factors.

We caution you not to put undue reliance on forward-looking statements and the forward-looking statements made during this call speak only as of the date of this call. In addition, comments made on this call may refer to certain measures such as EBITDA, adjusted EBITDA and adjusted EBITDA margin, which are not in accordance with GAAP.

However, management believes these results more clearly reflect our operating performance.

For a full reconciliation of EBITDA and adjusted EBITDA to GAAP results, in accordance with Regulation G, please see our press release issued earlier today and furnished as an exhibit to our Form 8-K dated November 2, 2015, which is located in the Investor Relations area of our website.

After our prepared remarks there will be a brief question-and-answer session. Joining me on the call today are Craig Ramsey, Interim Chief Executive Officer and Chief Financial Officer; and Mike Zwonitzer, Senior Vice President, Finance. I'll now turn the call over to Craig..

The Force Awakens and we shattered our first day advance ticket sales record by a multiple of 10. We sold out more than 1,000 auditoriums in the first 12 hours and we now have 30 theaters scheduled to be open 24 hours straight to meet guest demand on opening night. And we expect those numbers to continue to grow. With first shows at 7:00 p.m.

on December 17, Star Wars box office impact will crossover into 2016. And just how long it plays remains to be seen, but Q1 2016 will also benefit from Star Wars and provide a nice jumping off point for 2016. The question is by how much. I don't have an answer for that, but I have a high expectation.

We believe 2016 has the potential to be a very good year. We expect the tent-pole movies to perform like tent-pole movies and we also believe there is a breadth and depth of movie titles at the level below tent-poles with great potential as well.

Regardless, we believe our focus on being the guest experience leader differentiates us from our competition as we seek to monetize each incremental guest visit to drive additional value for both our guests and shareholders. And we look forward to the incremental contribution to revenues and EBITDA from the addition of Starplex.

Lastly, as investors look at our company and valuate our potential, we believe there may be an under-appreciation for our cash flow generation. Just last quarter, in Q2, investors focused on increases in film exhibition expense because of the concentration of films in the quarter drove film rent higher.

What we fail to communicate clearly was that while that expense component increased, it also drove attendance, attendance that walk up to our concession stand and MacGuffins bars and generates food and beverage gross profit dollars and margin.

These increasing gross profit dollars led to higher adjusted EBITDA and with our NOLs lowering the tax payments, our conversion rate of adjusted EBITDA to free cash flow is even higher. Free cash flow generation for the first nine months of 2015 has grown nearly 52% compared to last year.

Now, that's cash that can be used to reinvest in our existing assets, make acquisitions or return to shareholders. And for the time being, we believe the returns on reinvestment in our theaters and acquisitions are more compelling and will continue to be our first choice for capital allocation.

To our guests and shareholders, thank you for continuing to choose AMC. We will continue to drive value by implementing our proven strategies across a growing base of theaters. We believe our future is bright for the remainder of 2015 and beyond. And we look forward to seeing you in our theaters. Thank you for listening.

And I'd like to turn the call back to the operator, so we can take a few questions..

Thank you. At this time, we'll be conducting a question-and-answer session. Our first question comes from Eric Handler from MKM Partners..

Yes. Thanks for taking my question. So, when I look at your concession revenue, you had some very good another quarter of strong increases with per-cap spending. I am just curious as we look forward here, comparisons are starting to get a lot tougher, I believe the tax-on-top strategy, I'm not sure if it's fully cycled yet, but I think we're close.

Should we start assuming maybe some slower normalized growth rates or how should we think about concessions?.

Yeah. Thanks, Eric. Maybe the best way to think about it is to try to give you a little bit more insight into the increase in the current quarter. We saw the concession per patron up very nicely – let's see here, it's up about 6.8% to $4.58 from $4.29, it's about $0.29.

And as you split it up hard that $0.29 about half of it is initiative-driven and that's coming out of our Freestyle rollout, our MacGuffins bars, the fact that what we witness with new builds and our recliners is higher levels of spend, all of that rolls together to give about half of that increase.

The other half is pricing, and probably a good share of – we do take concession pricing. So, you may split that in half, and the half of the half and you probably accounted for the tax-on-top portion and then the other half of the half is related to just ongoing concession pricing that we take in line with demand.

We did implement the tax-on-top strategy last year early in the fourth quarter, so to your point, we are in fact approaching the anniversary of that initiative..

Okay.

So, going forward if you assume 15% you say was – 50% was pricing and 50% of that was tax-on-top, so I mean if we think about is normalized growth going to be around $0.075 per year and then whatever you have for initiatives, sort of, layering on top of that, a little bit more above and beyond that?.

Yeah. So, about – it's Mike, Eric. About $0.15 of it came from an initiative. I would expect we've still got quite a bit a runway there, I'd expect that to continue. And to your point about half of the tax on top that pricing will continue, but it's probably closer to the $0.075 you mentioned in the $0.15..

Great. Thanks a lot..

Yeah..

Thank you. Our next question comes from James Marsh from Piper Jaffray..

Great. Thanks very much. Just was hoping you could maybe elaborate a little bit on your strategy with the Dolby Cinema. Maybe just talk about your thoughts on co-locating with IMAX, how you price it relative to IMAX, just generally where do you see it kind of fitting in the whole branding process..

Sure. Well, as we said, we were early in the deployment of Dolby Cinema. We have eight Dolby Cinema at AMC Prime locations operational. We think there'll be eight more by the end of 2015 and then probably a total of 50 by the end of 2016, so pretty early in deployment. We think of them as very complementary frankly to IMAX.

We do enjoy a great relationship with IMAX, have 150 locations and we benefit handsomely when those films are in the market playing well. The Dolby Cinema at AMC Prime strategy allows us to kind of broaden our base I guess of offering big sight and big sound experience to movies beyond what may just be formatted for the IMAX presentation.

So, it's certainly complementary in that sense that it gives us additional flexibility to play more films in a larger presentation format and also, so not necessarily directly competitive with IMAX.

From a pricing perspective, we think the two are comparable and offer very similar pricing of AMC – Dolby Cinema at AMC Prime and IMAX are priced pretty much competitively..

Okay. All right. That's helpful. Thanks, Craig.

And then just quickly, where do guys think we should model, I guess, expenses for the film rental for fourth quarter? I think where do you think that range should be?.

Well, I think you have some good history that probably should guide you.

And that is, we've kind of I guess dispelled the myth that we were under some form of a secular trend coming out of the second quarter, which was received all the scrutiny that we had set a new level or a new benchmark on film cost when in actuality it was more related to concentration of films.

And then this quarter when – I guess, as I recall in the second quarter, the top five films were 55% of the box office and in this third quarter that's popped back down to 39%. So, that maybe gives you two fence post to work within, as you look at how much of the box office do I think is going to come out of the top five in the fourth quarter.

And if it's close to 55%, then maybe it's similar to where we were in the second quarter, and if it is more normal to 39% to 40%, maybe it's more like the third quarter. I mean, I think that the history is probably the best guide in this situation..

Yeah. Okay. All right. Thanks very much. I appreciate it..

You bet..

Thank you. Our next question comes from Ben Mogil with Stifel..

Hi, guys. Good afternoon. Thanks for taking my question. So, on the online ticketing, I'm kind of curious how you're thinking about the benefits. There's obviously some cost savings around staffing, et cetera.

But what do you think are you seeing those online ticket buyers buy more food in advance, are you seeing any kind of incidence increase I'm kind of curious actually mean from a business perspective?.

Ben, your phone was breaking up and in fact – let me just ask the group, is it breaking up? I'm getting quite a bit of interference on this end.

Are you all able to – back to the operator, can you hear us well?.

Can you hear me better now?.

Oh, yeah, much better, yeah. I think I got your question. It was about....

If you want – I can rephrase it if you want. Basically, on the online ticketing the numbers are great, and I get that.

What I'm more curious about is when you look at those numbers, are you seeing customers – other than some cost savings that you're seeing from a staffing perspective, are you seeing those customers come back more than the average customer, are you seeing those customers buy more food in advance, locked and loaded, sort of curious how that's actually translating to sort of the topline and bottom-line?.

Ben, I'd say that on – what we like about online ticketing is it commits people earlier to the experience.

And if you are sitting around chatting on a Wednesday or Thursday evening about what should we do this weekend and you start planning your activity and movie-going comes up, it's usually always in the conversation and you see something you like, you get online and you buy, you're much more likely to show up.

And so, the conversion rate of intent to buy to actual attending we think is positive. And so that's a good thing. We do see our AMC Stubs loyalty members more active I guess than non-members in terms of using the online ticketing.

The third point about food and beverage, we haven't seen a direct correlation between food and beverage buying and online ticket purchasing. We do have some initiatives planned, we think that will address that opportunity.

We think that is an opportunity and we can convert more food and beverage purchasing if we can bring that to life online and more to come on that in the future, something we're definitely working on..

Just to clarify, and thank you for that.

So you screens that were closed at some point during the quarter and I think you said you'll have about another 250 that will renovated before, I guess, Star Wars opens, is that correct?.

That's correct, 300 offline at some point during the quarter and we actually quite – this is probably one of the heaviest periods of construction. Most of those will open up before the holidays here in the fourth quarter. So, we'll look forward to some nice contribution from those new remodeled, fully remodeled and recliner reseated auditoriums..

That's great.

Just last point, what do you think the benchmark box office was for the quarter for you from a weighted perspective given that screens were closed during the quarter what do you think approximately was?.

The range has been 5.4% to 5.7%. I think that's probably indicative of the benchmark. The other thing that we looked at, we weighed heavily to IMAX obviously the IMAX premium format, IMAX was off about almost 5%, 3D down 14%, but IMAX was off 5%.

If we adjust or pro forma industry stats for the IMAX format, our performance was probably 30 basis points, 40 basis points ahead of the industry. So at or above industry performance is kind of how we thought about our box office performance.

This quarter, which really I think a big piece of it we were probably most interested or we paid most attention to was the attendance driving that we were able to do..

For sure. That's great. Thank you very much..

Thank you. Our next question comes from Barton Crockett from FBR Capital Markets..

Okay. Great. Thanks for taking the question. I was curious about the commentary on ticket pricing.

So, you told us that you outperformed by, I think, 330 basis points in attendance, but I was wondering if you could give us the same-store, kind of, trends in ticket pricing on your standard formats and premium formats and how you thought that compared to the industry?.

Let me look at the – let me kind of walk through maybe a little more granular how we looked at the ticket price. It was several things at play here, Barton, and the first of all was premium formats, and I mentioned a minute ago, they were down about 5% on IMAX and 14%.

So, not only were they down, we also had a product mix change and by that I mean the product was actually as I would say more kid-friendly when you had Minions and Inside Out driving your 3D box office. Last year it was Guardians and Transformers which was a little more of an older audience genre, if you will.

The other thing that we did that impacted our ticket price is we actually did some promotions in some off-peak periods and we introduced a discount Tuesday, new discount Tuesday for our AMC Stubs members for them.

And so, the combination kind of I guess came together, and number one, it did cost us a little bit on average ticket price, but it really did stimulate the growth in attendance. Now, to your question, the industry benchmark for average ticket price, we had it up about 2.1%. And attendance was up about – attendance was probably up about 3.5%.

I mean, that's based on what the industry is telling us..

Okay.

So to understand the delta in the ticket price, so I was assuming it was mix that you guys underperformed because you [over-split] IMAX which underperformed, but you're saying it was actually there was another factor in there which were these discount programs, is that correct?.

Well, yeah. It's mix and it's also genre, which I guess is mix as well. It's IMAX premium format mix, it's genre mix and we did some things with discounts.

I'd say it was promotional trying to – really trying to push some lower capacity utilization timeframes, trying to push some attendance to them and offer the Tuesday discount for our AMC Stubs members. That impacted us as well, but clearly the impact on attendance was dramatic as well..

When we look at you guys and I understand the relative performance, on the delta in your ticket price trend versus the industry, how much of it would you say was your promotion versus how much of it was different in mix that AMC chain versus the rest of the industry?.

It's Mike. About $0.09 of it was related to premium formats, so a big piece of it was related to premium formats. The other $0.06 was a combination of mix and promotional pricing, so Minions versus Guardians of the Galaxy and Planet of the Apes..

Okay. All right. And then – go ahead..

The other thing Barton I didn't mention is we did – we actually have taken pricing early in the fourth quarter kind of in advance of the holidays. As we look back to last year, we actually took pricing earlier in the year, so that would be kind of in that other bucket as well that Mike mentioned..

Okay. So....

As far as....

I'm sorry. Go ahead..

I was going to say what we've seen so far....

I am sorry. Just a follow-up.

I am sorry to keep interrupting, but is this just a one quarter issue that's promotional activity or is this kind of a change in the model that we should assume persist into the fourth quarter and beyond?.

I would say so the AMC Stubs Tuesday night promotional period goes through at least the end of December, so we'll continue to monitor that this year and decide if we want to go, continue with that program. As I look at kind of the quarter-to-date we're tracking pretty well ahead of last year on average ticket price.

So, I think last quarter is a little bit more anomalous..

Okay. All right. Great. That's helpful. Thank you..

Thank you. Our next question comes from David Miller from Topeka Capital Markets..

Hey, Craig. I just want to understand a little bit more about the dynamics of why you guys came in under the overall industry number. I know that you called out the dynamics from your – the tough comparison that mentioned in the third quarter of last year.

But, my understanding was that IMAX actually did very well on a per-cap basis in the third quarter as well and in fact Regal called out their IMAX business as one of the reasons they outperformed the overall industry benchmark on a calendarized basis.

They had the calendar SKU as you're aware of, but they did beat the overall industry number on a calendarized basis. So, I'm still not straight as to exactly why it is you came in under the industry benchmark if you can flush that out for me, I would appreciate it. Thank you..

One, I'm not sure which industry benchmark you are looking at. The one that we looked at gives us about a range of 5.4% to 5.7%, but we're in at 5.7% so we meet the attendance or we meet the benchmark of the industry. So I don't know how you are calling it underperforming the industry. We didn't..

Well, admissions – hold on a second.

Admissions revenue per screen you had said in your prepared remarks came in what up 5%, 4.9%, 5%?.

You are looking at it on a per screen basis?.

Yeah, on a per screen basis..

Right, that's correct..

Right..

5.7..

So what's your assumption for the industry screens, I am sorry?.

5.8..

Also you are assuming flat screens for the industry?.

Well, the industry is not growing, right. I mean, there's 38,000 screens in North America that hasn't really changed. I mean, on a capacity basis the industry is not really growing. So your brand, right, your whole brand is centered around, in general, beating the industry benchmark that's what you guys have done generally consistently since the IPO.

This time you didn't really do it. I know you came close....

If you look at box office, so IMAX was down 5% unsure what it was, what you're referencing early but IMAX was down 5%. We do have a 45% market share. We talked about some of the pricing.

I do think looking at a 7.4% increase in overall attendance and if you look at attendance per screen, I think, if you assume a 2% increase for industry pricing which were the numbers that we're getting from data. I think you would find it on an attendance basis we outperformed the industry by a couple of hundred basis points..

Okay. We can take it offline. You – that's fine, we could take it offline. Just move on to the next question. Thank you..

Thank you. Our next question comes from Mike Hickey from Benchmark Company..

Hi, guys. Thanks for taking my questions. Couple of easy ones for you.

Looking at Starplex, you look at the recliner installations and your planned rollout of additional recliners, you would assume that nearly 50% of that network would be installed with recliners, so curious, does that suggest that you're perhaps becoming more open to increasing your recliner penetration across your aggregate network or if there is something special I guess within Starplex network that would allow a larger concentration of recliners versus sort of your bogey for your total aggregate network? And then I have a follow-up.

Thanks..

Well, what drives our decision on number of screens that are feasible for remodel and which includes of course reseat is really the upside opportunity.

And combined with the productivity, and so lower level productivity theaters provide – have greater upside, higher level productivity theaters, the upside gets progressively less, and so there's kind of a point given the seat technology that you are working with where the numbers don't work.

We think, today, and I think it's been fairly consistent that at about 1,851 of our screens will be suitable for reseat and that's based upon the technology that we have today.

And I think your reference was Starplex where we've talked about 80 screens already in the reseated format and an additional 90 screens, so 170 screens of 340 screens – you're saying, well why is there's 50% and yours is less than that.

It may have to do with just the siting of their theaters, where they've sited their theaters, kind of, how old they are, they are generally pretty productive theaters, but it's kind of the same math that we use on our theaters, and it may well be that on average our theaters are more productive than the Starplex theaters.

But it is kind of the same math that we've used in measuring the size of the market, what's the upside opportunity and what's the level productivity or performance of the screens as they exist today..

Yeah. Fair enough. Yeah. That makes sense.

I apologize if I missed this in your prepared remarks, but when does the Starplex deal close? I think the original commentary was somewhat by the end of the year, but obviously, it'd be nice to close that deal before Star Wars?.

Absolutely. We're still working with the Department of Justice. That actually – that process is ongoing. It's actually moving along kind of as we expected. We hope to get some initial feedback over the next several weeks.

And based on the conversations we've had thus far, which have been very tentative, it's kind of moving along as expected in terms of the number of potential overlap situations we'll have to deal with.

We've set – we still would say, look by the end of the year that's kind of a safe bet I think or a conservative estimate of how that might move along, to the extent we can accelerate it going through the government process more quickly we will.

But as it stands today, we're kind of sticking with our end of the calendar year 2015 target date for completion of the merger and bringing those assets on-line..

All right. Thanks guys. That's a lot..

Thank you. Our next question comes from Chad Beynon from Macquarie..

Hi. Thanks for taking my questions. Craig, you went into some detail on the returns on the reseats, and in kind of the past you've talked about a five-year plan with the number of units in your core versus reseating, it looks like everything's going great now with the returns and you're not losing any market share to any new competitors in that space.

Could you help us think about the cadence of the rollout over this five-year plan and also if anything has changed in terms of the investment amount from you or your landlords, just kind of big picture how you are seeing that?.

Sure. We are about 47% of the way through the rollout. I earlier mentioned the 1,850 is kind of the target population. We've got 860 I think today, 863 so about 47%, just under halfway. So, two years to three years remaining and it's 300 screens to 400 screens a year is kind of the target or the pacing that we've set.

Dependent upon – to the second point of your question, landlords continue to embrace the idea, are interested in co-investing with this, so that gives us certain pacing to the rollout because we – that does augment the returns when we can get 35%, 40% of the total capital commitment from landlords. So, I think it's kind of steady as she goes.

The concept continues to work well. Returns are well above our threshold. It's the number one return opportunity we have in terms of deploying capital into our circuit. Landlords continue to embrace it.

We're continuing to work on opportunities to become more efficient in our deployment of seats and by that I mean we currently lose about half to two-thirds of the seats and we currently continue to work on opportunities to reengineer our seats to maybe produce lower percentage loss which could open up some more reseat opportunities at the higher levels of productivity in our circuit.

So, as I think about it, it's steady as she goes. We could accelerate a little bit, but frankly I think given our ability to work deals, the appetite of the landlords and the lease cycle underlying these assets, it all seems to work out pretty well at that 300 screens to 400 screens per year going forward..

Okay. Thanks. And then a follow-up just on that as well the capital deployment versus kind of your leverage targets I believe your – I think you said 3.6 in the prepared remarks of your presentation. And you should probably bump that up a tiny bit until Starplex becomes accretive.

How are you thinking about capital deployment in 2016 if there are more M&A opportunities available?.

Well, we'll generate pretty strong free cash flow this year. 2015, a chunk of which we'll utilize to fund the Starplex acquisition based upon how we think about 2016. We think the free cash flow generation can be yet again higher and we'll have money to put to work and maybe more acquisitions to look at it. They are hard to predict timing.

Our capital deployment in 2016 will probably be comparable to what it was, where we think it will wind up in 2015, so fairly consistent levels which we'll have some excess cash to deploy into some acquisitions..

Okay. Very good. Thank you very much..

Thank you. Our next question comes from Jason Bazinet from Citi..

Thanks so much. I just had a quick question on the 863 reseats that you talked about.

If you split that into markets where arrival of yours has not followed your strategy and those where arrival has followed your strategy, what have been the lessons that you've learned where someone has followed you guys? In other words, is it helping aggregate attendance is it diminishing the ROI from that initial bump you got, is there anything you can share?.

Hey, Jason. It's Mike. So we have seen some competitive activity. I would say we continue to believe that these grow the market, so we've kind of seen 70% is movement from one theater to another with 30% growth in the market. That doesn't really change when you have new entrants into a trade area.

Now, what I will say is we have certainly seen the incremental attendance at our buildings, not as high when you've got another competitor in the market, but what I would also say is we're still seeing returns well above our hurdle rates of call it 25%.

So, and look, we knew quite some time ago that we would expect that competitors would follow and we weren't underwriting these deals at 100% attendance increases and call it 60% to 80% cash on cash returns, so they are kind of migrating still well above our 25% hurdle rate, but kind of into the range as we'd expect it..

So, the way I think about it, Jason, is one, we can look at each of our market areas we think with a fairly high degree of confidence and we try to think of it as a mature market; what is the market look like when it's built out with recliners. Same way that folks would do in a new build deployment.

We look at it and see what are the competitors, what is the landscape, what does it look like with the reseat opportunities, what are the different theaters in the market and what does that mean for our capital returns when we deploy capital into our assets in those markets.

So, we are trying to anticipate competitive activity, because it is going to happen, it is happening. And to Mike's point, it does have some dramatic – some impact on the returns in the attendance upside. The other thing I'd say is that generally speaking, we do think this is good for movie-going.

We think that a better guest experience certainly at our theaters and certainly at competing theaters is good for the industry and keeps movie-going top of mind for everyone. So net-net is good for our business and we try to take as intelligent of an approach as we possibly can by looking ahead and planning and deploying capital accordingly..

Thank you very much..

Thank you. Our next question comes from Eric Wold from B. Riley..

Thank you. Two questions; one follow-up to previous topic.

On the acquisition front, would you characterize your valuation of opportunities as proactive or reactive? Are you out there kind of looking for targets, you're going to talk to people who may not be in the market yet or kind of just waiting for books to hit the desk before you kind of take a look?.

We are prospective. We're not reactive. And I'm not going to tell you who, but – no, you can wait till the phone rings or you can be out talking to folks. And we like to be – we like to sole source wherever we can.

And as I said before, we are generating free cash flow, we want to put it to work, free cash flow above and beyond our CapEx programs, our growth programs. And so, we need to try to cultivate those opportunities to the extent we can..

And then, in the last question on the food and beverage, your enhanced food and beverage initiatives that you've added to theaters, kind of when you – if you look at kind of the apples-to-apples addition to theaters, theaters that have MacGuffins, theaters that have dine-in, Freestyle, is the incremental gain that you see on the food and beverage for patron pretty tight on apple-to-apple basis or do you have situations where there is a big range of results from one theater to the next, and kind of what have you found caused that and how do you get them all to the better end?.

Well, certainly the dine-in theater has the more dramatic upside, just the absolute spend on a per patron basis on an enhanced food and beverage basis.

Certainly, the remodeled theaters and the recliners have probably on a percentage basis the next highest lift from their pre-remodel state, but that's I think a combination you are presenting more food and beverage options and just the overall experience is better.

And I think when people are in a – when avid moviegoers are in a facility that's well presented, they probably tend to spend more.

And then I think as you look at kind of the rest of the circuit, wherever you can put a bar in, wherever you get licensed for a bar, that's going to augment your food and beverage probably more than when you put in grab-and-go concepts, all lift, but you're going to get more a lift out of a bar than maybe some of the more straightforward traditional approaches to enhancing your food and beverage sales.

Is that helpful?.

No. I guess maybe I might have phrased it wrong.

Some of the time to look for, just take for instance where you added MacGuffins, is the lift on a MacGuffins basically the same for all theaters where you add a MacGuffin or do you have situations where some are minimal and some are way skewed to the upside and kind of what causes maybe that dynamic?.

On a per patron basis you do have some variation, but it's not significant..

Not much..

On a per patron basis..

Sorry. I didn't miss....

I mean, obviously the volume of the business – of the billing will drive different results, but on a per patron basis, they are not significant with Freestyle, with MacGuffins all of those concepts are very, very similar..

Perfect. Thanks, guys..

Yeah..

Thank you. You guys have one further question. Our last question comes from Jim Goss from Barrington Research..

Thanks for taking my questions. Just a couple; one, I was wondering, as you look at a full recliner reseated and with Dolby Cinema at AMC Prime and a MacGuffins and you get into the core urban markets, you're getting, it seems to me a little bit closer to some of the specialty premium types like an iPic or something like that.

Is there any sense that or any notion that you might create some stratification and take advantage of perhaps the pricing disparities that you've been reluctant to do and as you've executed on the recliner reseatings in some of the markets at least in some of those areas where you think you might actually be able to split the difference a little bit and get some pricing lift from doing something like that?.

Well, I would want to debate a little bit the argument that we're reluctant to take pricing on our recliners. We've always talked about, well, we wait for a year I think that's depending upon the situation.

We are actually accelerating the time post-remodel when we take pricing on the recliner remodels because it's fairly consistent market after market, the demand characteristics are there, the guest satisfaction feedback we get is positive.

So, Jim, I'd say we're more aggressive now than we've ever been in terms of the time in which we take pricing deep. On our Dolby Cinema at AMC Prime we have eight of them. To the extent we see demand growing and it is, we are comparing back to what we modeled and what we thought how they'd perform financially and they're exceeding the projections.

And so we probably can get to the same place that if we have demand that's exceeding what we had initially thought it probably does give us an opportunity to push pricing a little bit more aggressively than we may be initially thought. But it's pretty early in that rollout at this point in time.

But as we get closer to the end of the year and into next year, I think, we'll have much more, will be up to 16 locations, 17 locations, we'll have a much better sense of the overall acceptance and upside opportunity..

All right, Craig.

And the one last thing, in terms of MacGuffins, how many are there right now and is there any way to strip out the revenue and profitability impact from that initiative, because that is a little bit different from the core theater operation itself?.

Well, of the MacGuffins?.

Yes. Just out of the MacGuffins..

Yeah. We have 109 MacGuffins and look – a P&L on MacGuffins difficult you do have a lot of shared cost that would be tough to split out.

So, we've not spend a lot of time trying to do that, because you are making more assumptions than I think the answer you would ultimately get to, gets pretty diluted because of all of the assumptions you have to make on allocating cost..

All right. Thanks very much..

Okay. Say, I think that's it for our Q&A session. We want to thank you all again for joining us this evening. We do look forward to Q4. We got a lot of great initiatives. Looks like we've got a very strong product lineup to really finish out the year with a strong finish, and potentially setting records for the quarter and for the full-year.

We look forward to talking to you again after the end of 2015 as we get the year-end numbers all scrubbed up. We'll be back to you early in 2016. And until that time we look forward to seeing you at the movies. Thank you again very much..

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation..