Stacy Frole - Vice President of Investor Relations Matt Ouimet - President and Chief Executive Officer Brian Witherow - Executive Vice President and Chief Financial Officer.

Afua Ahwoi - Goldman Sachs Tim Conder - Wells Fargo James Hardiman - Wedbush Securities Christie Fredericks - Credit Suisse Barton Crockett - FBR Capital Markets Ray Cheesman - Anfield Capital.

Good day, and welcome to the Cedar Fair's Third Quarter Conference. Today’s conference is being recorded. At this time, I would like to turn the conference over to Ms. Stacy Frole. Please go ahead, ma'am..

Thank you, Anna. Good morning and welcome to our third quarter earnings conference call. I am Stacy Frole, Cedar Fair’s Vice President of Investor Relations. This morning we issued our 2015 third quarter earnings release.

A copy of that release can be obtained on our corporate Investor Relations website at ircedarfair.com, or by contacting our Investor Relations offices at 419-627-2233. On the call this morning are Matt Ouimet, our President and Chief Executive Officer; and Brian Witherow, our Executive Vice President and Chief Financial Officer.

Before we begin, I need to caution you that comments made during this call will include forward-looking statements within the meaning of the federal securities laws. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements.

You may refer to filings by the company with the SEC for a more detailed discussion of these risks. In addition, in accordance with Regulation G, non-GAAP financial measures used on the conference call today are required to be reconciled to the most directly comparable GAAP measures.

During today's call we will make reference to adjusted EBITDA as defined in our earnings release. The required reconciliation of adjusted EBITDA is in the earnings release and is also available to investors on our website via the conference call access page.

In compliance with SEC regulation FD, this webcast is being made available to the media and the general public as well as analysts and investors. Because the webcast is opened to all constituents and prior notification has been widely and unselectively disseminated, all content of the call will be considered fully disclosed.

Now I’ll turn the call over to Matt Ouimet..

Good morning, and thank you for joining us today. I'd like to start by reminding all of us that the record results and positive guest reviews we plan to discuss are produced by the operating teams at each of our parks as well as our corporate associates.

It is a privilege to work alongside these teams and I want to congratulate them on their success of producing our sixth consecutive year of record results. We are proud to what we have achieved during the past six years.

Our 2015 results reflect the combination of current season initiatives along with the contribution from decisions and investments we've made over the past several years. These include investments in our people, in the guest experience and our commitment to the growth potential of all of our parks.

While we have accomplished a lot in a relatively short amount of time, we believe there is still considerable upside in front of us. Beyond the third quarter we can now report that our record results continue through this past Sunday, November 1st.

Through this period net revenues increased to a record $1.2 billion up 7% from the same period last year. The improvement in net revenues reflects improved results across all areas of our business including record levels of attendance and guest spending.

We credit our broad winning success to the [indiscernible] of our FUNforward strategy to make every park a place to be for fun not just a place to ride rides. This expands our audience, increases length of stay and has a direct impact on our guest impact to return to our parks in future years.

Our record attendance of 23.6 million through November 1st reflects significant increases in both the season pass and advance sales categories as well as continued attendance led from our front gate and group channels. Equally important our unique visitors have increased by 2% compared with the same time last year.

Three years ago we began to do a considerable amount of research and analysis to better understand the number of unique visitors to our parks. While it is important to encourage our loyalties and pass holders to visit multiple times, we wanted to ensure our parks remain appealing to new potential repeat customers as well.

Today we have experienced an increase in unique visitors in both our season pass and non-season pass categories.

We attribute this growth to the success of our customer relationship management, or CRM platform, our incentivized group sales teams, our innovative capital programs and of course our frontline employees who are interacting with our guests on a daily basis. We have been equally pleased with the results on the guest spending front.

Through November 1st, our average in park guest per capita spending increased 2%. The year-over-year improvement in guest spending was broad ranging with increases across all major categories including admissions, food and beverage, merchandise and premium experiences.

This is a direct result of better segmentation of our guests and our ability to give everyone their own unique experience at a price level of their choice.

A initiative that contributed to the increase in spending included the first full year implementation of our all season dining program, new group catering facilities, multi-week special events and a good, better and best merchandise selection. Finally our out of park revenues were up 10% through November 1st.

We have been pleased with the overwhelmingly positive guest response to our renovation of the historical Hotel Breakers at Cedar Point. This hotel combined with the new catering facilities has truly transformed Cedar Point's underutilized beach area and was the largest contributor to the increase in out of park revenues.

Because of this success we are beginning to look at other opportunities to improve on or expand our resort accommodations at Cedar Point as well as other properties. The quality of our business model and disciplined focus of our team have never been stronger.

Based on our current year results and our positive outlook we are increasing our quarterly cash distribution by 10%. Beginning with our December pay map our quarterly cash distribution will be $0.825 per Limited Partnering unit or $3.30 per Limited Partnering unit on an annualized basis.

This represents the highest quarterly distribution paid in the company's history and has an attractive 5.5% yield at our current market price. We are very proud of this achievement and look forward to producing the operating results that will allow us to grow our distribution for many years to come.

I want to make just one last comment before I turn it over to Brian. One of the greatest assets we have at Cedar Fair is the quality of our relationships with our vendors. We refer to them as partners and as good we think we are running a business we would not be doing as well without them.

They are having a very real impact on our financial performance and our guest experience.

They include Coke, where their products have contributed directly to the strong food and beverage per guest, accesso our e-commerce platform which is a backbone for our online and mobile sales, CK our ad agency, who not only develops impactful creative campaigns but also helps optimize our media purchases and drives the increasingly important area of social media marketing, the ride manufacturers all those who have been with us for decades and those new to the party such as TRIOTECH and 3D live, our partnership with the San Francisco 49ers has and will continue to create great value for Great America, [indiscernible] team helped us restoring our legacy and we are excited about our newly established relationships with TE2, Electronic Arts, Rev3 Adventure and Colorvision.

Those I told about today and many others make both our job and our results much better. At this time I would like to turn the call over to Brian to discuss our third quarter and year-to-date results in more detail. Brian..

Thank you Matt and good morning everyone. As Matt mentioned we are very pleased with our strong operational performance till this past Sunday, November 1st, which puts us on track for our sixth consecutive year of record results.

As detailed in our earnings release, for the third quarter 2015 we reported an 8% increase in net revenues to a record $645 million. This was the direct result of a 6% increase in attendance in the quarter and a 2% increase in average new park guest per capital spending as well as 11% increase in out of park revenues including resort accommodations.

For modeling purposes during the quarter we entertained 12.5 million guests and out of park revenues totaled $65 million. We are pleased with our balance growth we had experienced across all areas of our business. Increase in attendance of 6% or 697,000 visits is a direct result of our strong capital program for the 2015 season.

This includes Fury 325, a world record breaking roller coaster at Carowinds, and Voyage to the Iron Reef, our new interactive digital dark ride at Knott's Berry Farm. Both of these parks are expected to report record full year attendance this year.

Canada's Wonderland our amusement park near Toronto and Valleyfair our park near Minneapolis have also contributed nicely to the year-over-year lift in attendance.

The 6% increase in attendance is attributable to broad strength across the majority of our core ticketing channels with the largest growth coming from the very important season pass channel.

The 2% increase in guest spending in the third quarter when compared to the same period a year ago came from increases in both admission per capita spending and pure in-park guest spending.

Our average admissions per cap to the quarter increased again this year as our guests continued to see high value in our product offerings, particularly in our season pass program, group owners and facilities and new rides and attractions.

Going forward we will continue to strategically increase pricing across our various ticketing channels while continuing to carefully manage discount offerings that appeal to the more value oriented breed of guests.

The increase in a pure in-park guest spending in the quarter reflects increase of guests spending on food and beverage, merchandise and premium mock rides.

Increased revenues in our new channels were driven by strong guest response to current season initiatives such as our all season dining program along with continued roll out of initiatives we have implemented over the past several years such as Fast Lane and Fright Lane.

We are extremely pleased with the solid per caps across all of our parks, particularly given the year-over-year growth in season pass visits which tend to place additional pressure on the key metric.

11% or $7 million increase in out of park revenues in the third quarter reflects improved results from our resorts properties led largely by the successful renovation of the historic Hotel Breakers that Matt mentioned earlier.

Moving onto the cost front, operating costs and expenses for the third quarter totaled $302 million representing an increase of $90 million or 7% from the third quarter of 2014.

The increase in costs is consistent with the 6% lift in the attendance at the end of period and reflects the impact of [27] incremental operating days in the third quarter related to the later timing of Labor Day this year.

The increase in operating costs in the quarter also reflects the impact of higher labor and maintenance costs as we continue to invest in our employees and infrastructure to support our revenue growth initiatives.

Meanwhile adjusted EBITDA which we believe as a meaningful measure of our park level operating results totaled $346 million for the third quarter of 2015, up $30 million or 10% year-over-year.

Adjusted EBITDA margins for the quarter improved 60 basis points as compared with the third quarter of 2014, a direct result of the meaningful increases in attendance, guest per capita spending and out of park revenues all which produced our record third quarter revenues.

As for results for the first nine months of the year, revenues in the period increased $70 million or 7% to a record $1.1 billion. This year-over-year increase was driven by a 5% or 917,000 visit increase in attendance, a 2% or $0.89 increase in average guests per capita spending and an 11% or $11 million increase in out of park revenues.

Operating costs in the period were $34 million or 6% reflective of the 5% increase in attendance and an increase in the overall number of operating days. Adjusted EBITDA for the first nine months of the year increased 9% to a record $429 million up $35 million from the same period a year ago.

It's important to know that year-over-year operating comparisons have been impacted by foreign currency translation related to our park in Canada. Adjusting for the impact of foreign exchange our revenues through the first nine months of the year were around 9% or $89 million and operating expenses would have been up 7% or $43 million.

Adjusting for the impact of foreign exchange adjusted EBITDA for the first nine months of the year would have increased 11% or $44 million year-over-year.

As we enter the fourth quarter we do expect slight pressure on our year-over-year adjusted EBITDA comparisons, as a result from the fourth quarter of 2014 benefited from the receipt of a business interruption claim at Cedar Point related to the water main break at the park last summer.

Also putting pressure on fourth quarter results in 2015 will be higher incentive compensation expense, given our record results this year and the end price increased when compared to the fourth quarter last year. Now I would like to our attention to results for this past Sunday, November 1st.

Based on preliminary results revenues through November 1st were up 7% or $74 million to $1.2 billion. The year-over-year increase was a result of 5% or 1 million visitor increase in attendance to a record 23.6 million visits and a 2% or $0.71 increase in average in the park guest per capita spending to a record $46.28.

During the same period out of park revenues increased 10% or $12 million to a record $127 million. Adjusting for the impact of foreign exchange revenues through November 1st, would have increased 8% and our average in park guests per capita spending would have been up 3% year-over-year.

This is the second year in a row where we've reported record post Labor Day results. Over the past several years we have invested in permanent structures for many of our haunted mazes. We've expanded our scare zones, and we've increased the number of family-friendly daytime Halloween activities.

Our Halloween events offer a complete immersive experience at quality and scale no other regional amusement park or entertainment venue can match.

We clearly have benefited from the popularity and growth of Halloween and we are looking at ways to expand our operations to other times of the year where we can offer unique immersive experiences at a scale unmatched by others.

Similar to our third quarter results the year-to-date increase in attendance is attributable to broad strength across the majority of our core ticketing channels.

The very important season pass channel has been particularly strong and through the end of October the percent of overall attendance from season pass visits was up approximately 140 basis points over the same period last year.

The increase in season pass visitation resulted from a combination of more units sold and our season pass customers visiting often. I am also pleased to say that revenues from advanced sales of 2016 season passes and 2016 all season dining plans are off to a very strong start.

Finally before I turn the call back over to Matt, I would like to provide an update on our tax planning work. As we have been predicting for some time we expect to use out the remainder of our corporate net operating loss carry forwards in 2016, which will increase our annual cash obligation going forward.

In anticipation of this increase we have been performing an extensive review of our options regarding tax planning alternatives. Based on these efforts I can now tell you that we intend to reorganize our operating structure beginning early 2016.

This reorganization will allow us to allocate income and expenses among all of our subsidiaries in a more tax efficient manner and have a slightly lower entity level effective tax rate since more of our [revenue] will be floating through on a Master Limited Partnership.

It’s important to remind you that we do pay 3.5% entity level tax on revenues floating through the partnership. Beginning in 2016, we would now expect our cash, cash liabilities to range in $55 million to $65 million annually and we would expect our effective tax rate at a range of between 20% to 25%.

I need to reinforce that these are estimates based on our FUNforward 2.0 long term goals and these estimates could change if business conditions change.

I should also note that our tax planning efforts may impact the information reported to investors on their K-1 tax forms beginning from 2016 tax year, including incremental income or loss allocations from four additional states.

As each of our unit holders have very different tax attributes its impractical for us to state exactly the impact of our planning on every unit holder. If you would like additional information on the potential K-1 impact please call our investor relations department and they will be happy to assist you.

In conclusion, our operation has continued to generate a significant amount of cash. Our capital structure and operating strategy provide the flexibility to increase our distribution more aggressively and if we choose similar to what we have done over the past three years.

At the same time we have the ability to make additional capital investments that provide attractive returns. As always we will continue to prudently manage our cash flow to maximize value for our unit holders. Now I will turn the call back over to Matt..

Thank you, Brian. As I mentioned in my opening remarks the quality of our business model has never been better. While I am pleased with the strong results we have achieved this year, I am increasingly confident in what we have in store for 2015 and beyond.

Earlier this week we issued a news releasing summarizing our lineup of new rides and attractions at our parks for 2015.

These capital projects should make next year a memorable one for our guests as we introduce a world record breaking roller coaster at our flagship park Cedar Point, a major water park expansion at Carowinds where we continue to aggressively invest and many other new attractions at our other parks.

We are also looking forward to celebrating the 75th Anniversary of Ghost Town at Knott's Berry Farm. Ghost Town Alive will be an interactive entertainment experience which immerses guests of all ages in new stories and adventures each day in the familiar town of Calico.

In addition we have partnered with Electronic Arts to introduce two new digital attractions next season. A new interactive digital experience at Carowinds based on the popular Plants vs. Zombies online gaming platform and all new 4D Holographic experience at California's Great America based on the Mass Effect video game series.

Growing our unique guest base in a cost efficient manner is important to us. We believe our partnership with Electronic Arts will help us tap into a new audience and leverage marketing channel but that has not been easily available to us in the past.

As these innovative digital concepts prove successful in the parts where we are introducing them, we will be ready to expand this platform to other parts in the near future. We also expect additional growth in 2015 from our all season dining program.

It was a significant contributor to our growth in guest spending in 2015 and we will now have the benefit of increased awareness by our customers. We expect the adoption curve of this product to ramp up in its second year similar to our experience with Fast Lane and other premium products.

We will also move towards the expansion of our mobile applications testing. Our team at Kings Island has done a great job with this new platform which is allowing us to find new ways to interact with our guests and improve their overall experience.

In fact this fall, Kings Island season pass holders were able to embed their pass within the app eliminating the need to carry a hard copy of their pass with them each time they visited the park. Next season we hope to expand our new mobile app to additional Cedar Fair Parks.

The buildout of free Wi-Fi and mobile applications at our parks will also allow us to benefit from new initiatives within our long term growth strategy. This includes FunPix our new digital entertainment platform which will be offered in our five largest parks next year.

We want to create an environment where digital photos became an intrinsic part of the overall park experience. Our new platform will allow our guests to instantly share memory digitally with friends and families creating an engagement that extends before, during and after their park visit.

While we are not ready to provide all the details behind our 2015 plans at this time, I want you to know that we will continue to expand our operating season to additional multi-week special events including a new winter holiday event at California's Great America.

We also continue to make progress on the multimillion dollar huge sports facility which will be located across the base in our Cedar Point Amusement Park. We currently anticipate this facility to open in late 2016.

Finally we continue to explore opportunities to use cutting edge technology to create a shiny new categories of attractions and other enhancements of the guest experience at our parks. An example of this is the virtual reality coaster experience we have been testing at Canada's Wonderland in partnership with VR Coaster and Mack.

Brian and I recently had the opportunity to ride the coaster with a virtual reality headset and it is amazing how the overall ride experience can change when integrated with digital technology. We will continue testing this product in the off-season and into next year.

It is not certain where this new experience will take us, but we believe that as this technology continues to advance, our opportunities to revitalize the existing capital and improve the guest experience are limitless. Given the business we are in it is appropriate to say we're thrilled with our prospects for the future.

We believe our long term strategy is working and we remain fully committed to executing this strategy to drive the greatest experience for our guests and in turn strong returns for our unit holders.

Our confidence in our business model and our strategy reaffirms our belief that we are on track to achieve our FUNforward 2.0 long term growth goal of $500 million or more in adjusted EBITDA by 2018. Now we will open up the call for any questions you may have..

[Operator Instructions] We will move first to Afua Ahwoi with Goldman Sachs..

Good morning. First on the -- I think at the Analyst Day you had mentioned some parks in your system could grow in size, any update here and what would the implications be for CapEx especially as we are coming off the Carowinds sort of spent? What can we expect going forward? And then, just two other questions.

Generally how do you think weather helped your attendance this year and we know you were lapping some easy comps last year, so was this average weather or above? And then just finally, I was -- in your comments on expanding the season was pretty interesting.

How far do you think that can go? Obviously you can become a 355 day a year resort or park, but how far do you think you can go in terms of how many days of the year you can operate?.

Good morning Afua, this is Matt. I will hand off to Brian a little bit on the CapEx, but let me see if I can address each of these. I will give him in a little bit in order, it’s okay. I think what we were to conclude on the year is we had average weather.

It started off a little slow, a little less, got nice in the summer and by the time we got in, we closed a couple of parks on a couple of days because of some storm and by the time we got to the end I think we would tell you that weather averaged out. Not spectacular but certainly not unfavorable either.

From the park growth standpoint, the way I've been characterizing internally to the Board is, I probably did a poor job on Carowinds because I think we underestimated the potential of that park.

And even given what we had assumed going in with our new CapEx it is exceeding our expectations and has for the first time jumped over the hurdle of 2 million plus in attendance.

We are doing the same type of exercises that we did for Carowinds, as we had mentioned before for Valleyfair and for Great America and to some degree for our other parks and I am optimistic.

I don’t know that the opportunity will be the same size as Carowinds but I think that given our success at Carowinds it makes us beyond curious for what might happen at Valleyfair and Great America.

I should say in those cases by the way, we may have more tight restrictions than we have at Carowinds and that may ultimately prove to be a limiting factor. Although we recently filed a re-zoning application for Great America which will expand our opportunity for what we can add to that park.

And Stacy just reminded me it would be I would be remiss because I am sitting here today, we still believe that Knott's Berry Farm has a long way to go. It has for the first time in its history exceeded more than 4 million in attendance and we don’t think that's going to stop any time soon. Brian why don’t I let you address the CapEx..

As it relates to the CapEx I think the max point we still need to get through some of those hurdles around the re-zoning of Great America and some more of our internal analysis and modeling for Valleyfair is two examples before we will know what the impact will be on CapEx.

But it would be our goal to as we have in the past prioritized our existing capital dollars accordingly. So I can't say at this point that there will be incremental CapEx but there is still more work for us to do on our side before we know if the true opportunities lie at those other parks..

And then your third question or your fourth question I guess it was, was about the fairly operating season and I guess because we are coming off a hugely successful Halloween season it makes us think more thoughtfully about what is available to us particular in markets where the climate is more favorable.

So we will start with Great America this year, I am sorry, in 2016 this coming year and we have high hopes for that particular property and obviously if that proves successful you can expect to see it at multiple parks, maybe not at all parks but at multiple parks. And that would be the primary growth driver when we talk about expanding the season.

I should point out again, since I am sitting here, we already have an extremely successful Merry Farm program here at Knott's Berry Farm and so we are going to take a lot of lessons, keep learning there, about what entertainment works, what food product works and how to market that product in order to leverage the attempt that we are making up at Great America..

The other thing, Afua just to follow on Matt's line that I would highlight is, we view expanding the season at almost in a little bit of different light and we are looking to expand the season within the existing calendar we already operate in. You have seen us this past year introduce a number of spring time events to drive the incremental growth.

So it doesn’t mean necessarily adding more days as it does adding more urgency around the existing days and we saw a lot of success this past year as well as like a couple of years here at Knott's with their Boysenberry festival, at Carowinds we introduced something called Taste of the Carolina.

So you will see us do more of those and that's a little bit of a blend as to maybe some CapEx investment but probably more OpEx dollars. So some of that is reflected within the operating expenses that you see sort of on the year-to-date numbers..

Okay. Thank you..

We will now take our next question from Tim Conder with Wells Fargo Securities..

Congratulations to the whole team for ongoing great execution of the strategy. A couple of things here. Matt and Brian, you commented that year-to-date through November 1, that the results continue as we saw through Labor Day.

But SeaWorld just on their call prior to yours mentioned that they were impacted by some of the remnants of Joaquin and obviously that would have impacted your Carowinds Park and then some of your other parks up the East Coast to a degree.

Any way to quantify how much that limited was extremely good results here?.

Yes, Tim, the honest answer is we know we had to close for a couple of days but we think the vast majority of that attendance loss was recovered in the balance of our Halloween season.

So I don’t know how we would quantify that but I would say to you qualitatively we didn’t think -- by the time we got to the end of the year that we lost much associated with those days. You are going to have those days occasionally whether they be in June or October..

Then two other questions by me, the mobile app, again you commented that you have tested it and it sounds like it's going to pretty well. Kings Island you are going to roll it out at a total of five parks in 2016.

Do you have any additional color you can give other than the integration going digital with the season pass, any other things that you can share with us on that? And then the last question is Matt, on looking at the expand resorts and the combinations and things that you have done with the upgrade at the Hotel Breakers, maybe areas that you could be targeting over the next one to two years there and any additional color please?.

Let me -- I will give you a little correction, Tim. So we are rolling out the Wi-Fi to five of our parks this year. We are going to continue to test the mobile app at Kings Island and then expand beyond that as we get more traction.

The real benefit of the mobile app ultimately is to give the consumer better experience, so right way times and other benefits associated with that. But it allows us to communicate on a real time basis with the consumer in the park and make incremental purchase behavior.

And so we are trying to find the right bells and whistles associated with that Tim. So I would tell you I expect the path which we refer to as TE2 to roll out to other parks this year, but we still got some testing to complete at Kings Island before that happens.

Brian you want to talk about the resort strategy?.

Yes, sure, Tim. We said in our prepared remarks we are extremely pleased with the guest response to the Hotel Breakers renovation that took the past couple of years to complete, and it has in 2015 delivered all of the qualitative and quantitative measures we had put in place.

And as Matt said on the call, quite frankly quantitatively exceeded what we anticipated. Based on that we are taking a harder look across the system, even though we have resort accommodations of some scale in other five or six of our properties a number of them are more of a campground, high end cabin orientations.

We will look at the opportunity to expand those existing facilities as well as cab facilities like that to other parts. I don’t know as we look at the portfolio that we have kind of 11 parks where hotels make sense. Clearly the majority of our hotels are at Cedar Point with another here at Knott's Berry Farm.

Those two parks, Cedar Point and Knott's are probably the only two parks in our system that you would say qualify as a regional resort destination. So the looks at the other parks of ours are focused more along the high end campground cabin setups.

Other than I will Carowinds presents an unique opportunity that we are going to look at across the couple of different platforms, hotel, cabins, boats and so that's going to take a little bit of time.

But we are saying now that we do think that the scale and quality of the accommodation offerings that we have in our portfolio differentiate us from just everybody else in this space..

Then it would seem like the cabin campground obviously within your existing CapEx parameters and then if you do anything beyond that could be more of a one-off type of little blip if you would do that longer term?.

I think that's mostly fair Tim we got to complete our analysis. I will tell you and I just want to emphasize it. I think the differentiator element that it provides the direct returns it provides along with the strategic value it provides in terms of defining our properties as multi-day business et cetera.

We are exceeding our expectation and I want to make sure we take that lesson and apply it and Carowinds is clearly high on our radar in that regard..

And then just one clarification on the mobile app Matt.

You said Wi-Fi, how many parks have you got that fully rolled out?.

Five parks will get installed free Wi-Fi this year Tim. Part of what -- it’s a basic consumer expectation these things but also it is an infrastructure for which we hang a lot of what we want to do with the consumer.

And the best example is our new digital picture initiative will be much more effective when its implemented in the parks with the Wi-Fi allowing us to communicate with the consumer and the consumer to instantly share that message. Going forward I expect Wi-Fi will be in all of our parks over the next two to three years.

It's just becoming a consumer expectation..

Great. Let’s see you at our conference this week..

Yes, looking forward to it Tim. Thank you..

We will now take our next question from James Hardiman with Wedbush Securities..

So a couple of questions for me.

Obviously Labor Day helped certainly based on my math it wasn't the entirety of the strength that you saw, obviously it's difficult to quantify Labor Day, but can you help us to dimensionalize how much of the strength that you saw was Labor Day versus some of these other items?.

Sure James, this is Brian. As we did say 57 incremental operating days in the third quarter because of the timing of Labor Day, that was generated at six of our parks where their natural operating calendar [indiscernible] with the Labor Day as to those extra days.

About the seven, we know that maybe we are not going to lose all of the attendance generated on those incremental days is wholly incremental attendance.

There is shift in visitation, a meaningful portion of the attendance that come from our day guests as well as our season pass visitors is a migration from another day that they were planning to visit.

As we go through on trying to estimate the impact of that what I would say is it is likely somewhere in and around 100,000 to 150,000 visitation from those extra 57 days.

On the flip side, it's important to note and as we said in the prepared remarks those incremental operating costs that are entirely incremental to those 57 days, so having extra 57 days this year or any extra days in an operating calendar it’s a balancing act for us because now the attendance you are going to generate is wholly incremental and all of the costs are.

That said we are very pleased with the results we saw post Labor Day and through the end of October..

That sort of dovetails into my next question, with respect to EBITDA margin. Love to see the 60 basis points of expansion.

But just help me understand a Labor Day was that a net positive to that EBITDA margin number neutral or negative and then how did FX affect that? Ultimately is this sort of a turning point for margin, obviously the prior couple of quarters of margin growth have been somewhat anemic. This is really good.

How should we think about that going forward?.

James, margin on our expansion is something that we are focused on if not the only metric if there was there are a lot of other initiatives that we have put in place over the last couple of years that either immediately put pressure on margins or over the long term take a little bit of time for generating the returns.

On the 60 basis points of expansion we are seeing through the third quarter we are very pleased with. Part of the quality is exactly how much that Labor Day, those extra days played in, I will say all over our field is at a high level.

That both the incremental attendance and the incremental days was well worth it and so from a cross perspective as you will take it every day of the week.

As we look towards the end of the year, due to some caution there is going to be some pressure on EBITDA in Q4 and indirectly or directly on margin as we have got some anomalies in the fourth quarter of last year that benefited us nicely.

Most notably the $2 million to $3 million of insurance proceeds we received on the business interruption claim at Cedar Point, all of that falls in right at the bottom line. So we don’t have that coming in this year. And then ultimately where we end up is going to depend on a large part to how Knott's fares over the last two months of the season.

They are coming off of two straight record Decembers with their Knott's Merry Farm as Matt alluded to. If we can get that kind of performance again this year it will go a long way to holding on a good chunk of that margin expansion that we see through the end of the third quarter.

But we have had some pressures like El Nino, the threat of El Nino is also that we are paying close attention to. So what I will tell you at this point is we are going to have margin expansion.

By the end of the year we will be 60 or more or be inside of 60 that's probably rough margin say we would be inside of -- a little bit inside of 60 based on what I know today..

Then I guess two more for me. So the distribution, maybe just walk us through that decision making process. Remind us once it upon a time it was based on debt covenant factors, now this is essentially entirely up to you guys. Remind us if you are looking at trailing versus forward numbers. Are you kind of tied into a payout ratio.

How should we think about your rainy day fund in terms of the balance of cash on the balance sheet? And then last question if I may, just the tax adjustments that you have made remind us had you not done anything what your tax burden would look like and ultimately how much savings you are driving by reorganizing the business?.

So I will start with distribution, Brian feel free to jump in and then I will defer the tax kind of to Brian. I think James what we can say definitively is that the distribution is core to the investment thesis so far. We understand that for our investors and we pay a lot of attention to it.

As we spoke of in the past years, as you indicated we are no longer restricted by covenants and principality would pay out in any rational basis and the balance sheet is to the point, both from a rainy day fund and a degree of leverage standpoint where we no longer feel like we need to build up a bank of liquidity any further.

So it remains a priority for us, over the last several years we have done what we have said we are going to do which is grow it aggressively vis-a-vis once we understood our operating performance and this year is another good example of that.

So we are not looking to specific payout ratio but I will say we are not looking to build a larger rainy day fund at this point..

Yes. One follow-up comment. I think as it relates to distribution and Matt alluded this, it's a decision that's not made in complete isolation, its bounced -- any other decision on the use of cash is bounced up against it and a little bit of both of those. So we are very pleased with and I think our investors I hope are pleased with that.

We have shown the ability not only aggressively in fact we did most of the several years that also grow the distribution aggressively. So I think you will continue to see us with the support of the Board take that approach which is more of an discussion from a use of free cash flow.

So then as far as James, as far as tax reorg, we haven't given any guidance really beyond 2015 in terms of absolute dollars as to where cash taxes were headed. But I think what we have talked about publicly was that on a rough effective tax rate basis I found that in my prepared remarks was that we would be more in the 20% to 25% range.

That previous range had we not done anything was probably more in the 25% to 28%. So you can see from that the shift in the effective tax rate going forward, there is savings there.

The other thing though that I think was a focus for us was trying to create a little more predictability and so we feel very comfortable that that $55 million to $65 million range is a range that will be in place for the foreseeable future and that we don’t see it escalating like it would have under the previous structure..

Thanks for the color guys..

We will now move to our next question from Joel Simkins with Credit Suisse..

This is Christie on for Joel. Brian, in your prepared remarks you mentioned that you'll continue to increase pricing. I was just hoping you could give some more color there and how you're thinking about pricing in 2016 compared to 2015..

From a pricing perspective it's probably a different answer for each one of our parts and its often tied back to where the capital problem is. We went into '15 as we were very open about with maybe taking the foot a little bit off of the gas pedal when it related to pricing. I would say we were a little bit more focused on volume.

That wasn't to say that we felt that we had gone [indiscernible] broadly anywhere. I think as we look towards '16 we are focused again on pricing. I don’t know that we will see broad pricing increases across the spectrum but again where we feel we have got strategic opportunity to fair pricing we will.

As we talked about there still is a very heavily bifurcated economy that we are operating in and so we are also at the same time very focused on trying to create the value proposition for those folks that maybe are struggling to figure out how to afford those hotels.

I think you will continue to see us take pricing in the peak period where we have demand and then in the shoulder periods where demand is a little softer we will continue to go after discounting on a very discrete basis..

The only thing I will add is when we separate from the foreign currency impact, per caps across the board admissions at in park peer were up between 10% and 12%. And I think that is a very good balance given what we have seen in terms of driving attendance and in park spending in terms of the larger season base..

Great. Thanks..

[Operator Instructions] We will move next to Barton Crockett with FBR Capital Markets..

Thanks for taking the question. I was curious about the momentum in Carowinds relative to the CapEx. So you had a big program this year. Fury 325 helped the park. Next year, I think you've announced an expansion of a water park there.

Does this feel like the type of CapEx that's kind of drive the type of returns you got this year or is the CapEx profile less and maybe we should assume a deceleration of the trend there at Carowinds?.

First of all there is a major expansion. It’s the largest water park expansion we have ever made and also we will make it the largest water park available in North or South Carolina. Barton, Carowinds continues to exceed our expectations. We are going to continue to invest strongly behind that.

We think it’s a market that ultimately can match what we do in Cincinnati and maybe beyond. I am not looking towards a slowdown but when you see such a big jump in a single year you have to be a little [cautious] of what you might achieve in the second year. So therefore we are anticipating growth.

But I don’t know that it would be responsible for me to tell you, we had get equal growth for this year. But it is a great market for us. It was a great decision by management and we are going to continue to strongly invest behind that product until we see the curve bend over there.

The biggest part of our capital next year by the way is that our biggest park which is Cedar Point and so as I watch that go up and with the strong results we have seen from Hotel Breakers this year I think the [indiscernible] portfolio next year although I got to tell you Carowinds is getting a lot of attention, I think Cedar Point has got something under the radar for next year that will make a big difference and I hope we are right..

And to that point, if you look at the portfolio of attractions that you've outlined relative to the big kind of initiative you have in 2015, does it feel similarly impactful overall or maybe somewhat less impactful? How would you characterize it?.

I think it's going to be great Barton. I hope you guys realize on these calls we tend to moderate our comments a little bit, but I am most excited about 2015 as anything I have seen since we got here. I like the mix of traditional steel basically the Cedar Point clearly has done an anchor for us in a good way over the last decade, several decades.

But the digital interactive I think is going to tap into a new audience. My favorite line that was posted online about our product which Mack attracted Great America was a guy that said I don’t know what Great America is but I am going.

So I think the collection of that, Knott's Berry Farm with the 75th Anniversary of Ghost Town plays very strongly to the legacy that's worked so well for us in a highly competitive market. So '16 for me is really well positioned from a capital standpoint and we got some of the older stuff behind us.

The Breakers Hotel behind us is good and the reputation its built this year because of how the job the team did in restoring it have to beat the better results next year as well. So look I got stop there, it's not my usual approach, but I am really solid about 2016..

Barton one follow-up question as it relates to Carolina, the addition of the water park and the major expansion that is going on there is very strategically placed. For Carowinds to ultimately get to those levels and Matt has alluded to Kings Island, Canada's Wonderland level of attendance.

It means to grow a season pass base beyond where it's currently at. It had a nice lift this year, but it's got to get to a much bigger number to get to the overall attendance numbers. We know from prior experience that a water park expansion of this level particularly in this kind of climate is what will drive season pass sales.

It's the water park visitors and much more repeatable visitors and client volume. Kings Island is probably our best example when we expanded their water park the lift we saw in season pass was huge and so that's the reason to follow up the big coaster with this kind of thing. It will have an attendance lift.

To Matt's point there are a lot of factors at play, can we assume it will have quite the same impact that at Fury 325, that will be a big bet but at the same time it’s not out of the question..

The only thing this would pile on is we are taking the opportunity here at Carowinds to look at what I would call the next generation water park and the biggest part of that how do you drive per caps once they are in the water park. It will have the largest dining facility we have ever put in the water park.

It will have shaded walkways to keep people there longer that like to stay. We will have bigger areas for young families. I mean it's designed in a way that I think you can take advantage of when you go to scale on an expansion like this. So I think it will make a big difference and we will look forward to see what happens..

Okay. That's great color. Thank you very much..

We will take our next question from Ray Cheesman with Anfield Capital..

Congratulations on a very good year, Matt. Your team did a terrific job. I wanted to ask you your thought process since you have I think some pedigree from this company in the past, this whole argument about variable demand pricing. I don't know if your technology supports it. I don't know if you think it's a great idea.

Obviously, adding 1 million people a year must mean that you get some days that are pretty busy and I'm wondering how you can benefit from it..

Ray I will tell you our technology absolutely supports the ability to do dynamic pricing.

Not only through the front gate pricing but also through the products inside the park where we -- the best example from the dynamic pricing standpoint is literally changing on a daily if not an hourly basis for Fast Lane passes based upon the demand we see in the park. So we can do it.

I think there has to be a balance to it, because I think in a lot of cases consumers need to know what the band of the portability is. So in our case we will do it. But I also I don’t know that we will change it on a daily basis. We clearly will mix it up ultimately between weekday and weekends.

The biggest emphasis for us in terms of that I think is to continue to educate the consumer that the early season for our regional parks is not the most affordable time to come and also one of the bad times to come because the water park's crowded. So I think ultimately the systems will allow you do it.

I think you got to be careful but it doesn’t ultimately confuse the consumer. But there clearly is an opportunity from a revenue management standpoint..

Second question was macro oriented. There was some write ups in the Wall Street Journal recently about another movie studio deciding it's going to take its library of themes and concepts and create more amusement parks.

And since you guys are in that business, I'd be very pleased to learn about the difficulties of making more amusement parks out of Hunger Games..

I find it very -- an amusement park of scale, we have said this before the barriers to entry and we are seeing it in the regional amusement park are very substantial in the United States. So I continue to believe that you won't see a regional park still being built other than maybe a Lego park here and there in this country in the foreseeable future.

Some of the concepts that Brian gave and others have talked about I am not all that familiar with but I can state they are ultimately going to be much more successful trying those overseas than they are in the U.S..

Matt, if you have an opinion, can you share, why did the Hard Rock Park fall on its face in such a high visitation area, not that far from your Carowinds, actually..

We have studied it Ray because we want to make sure we are smart about it. I suspect there is another reason. The part of the challenge is when you -- by the time you get the road built and the infrastructure and all those stuff that it takes to open up a piece of land it’s hard to have money left over to build the scale.

So with not a full day of experience you can’t charge a full day price and those economics break down very quickly. And so I think that's exactly a validation of what we see in terms of our barriers to entry..

And that does conclude our question and answer session. I'd like to turn the conference back over to today's presenters for any additional or closing remarks..

I only want to thank you for your questions this morning and your ongoing interest in Cedar Fair. As I hope comes across I am proud of our team and their commitment to the guest experience and I am proud of our world-class properties.

The decisions we make today are grounded in our desire to ensure we will still be proud of those decisions 10 years from now. Although I have done more today than I usually do I want to emphasize it again, we have accomplished much in the short period of time. For we believe there is still considerable upside in front of us.

We appreciate the open dialog we have in support of our unit holders and we remain committed to executing strategy that creates maximum value in both the short and long term.

With that, Stacy?.

Thank you everyone for joining us on the call today. Should you have any follow-up questions, please feel free to contact me at 419-627-2227. We look forward to speaking with you again in about three months to discuss our fourth quarter and year end results..

Once again that does conclude today’s conference. We thank you all for your participation..