CNK
#Thank you, <UNK>.
I think you had three questions there.
I'll see if I can get to each one of them.
Relative to seating capacity, we are not concerned about a lack of seating capacity, because we're very careful before we re-seat to make sure that the market ---+ that we'll be able to meet demand.
I don't think that's going to be an issue because of the analysis that goes into it ahead of time.
Relative to concessions, the answer to that is, yes.
We are seeing an increase in concessions with re-seating.
And so that's another positive element relative to doing that.
And your third question was ---+ oh, virtual reality.
Yes, absolutely, we're looking at that.
Do I see it as a big strategic initiative for us in the near future.
No, I don't.
Are we looking at the technology.
Absolutely, yes.
That technology will certainly find its first growth engine in the gaming world.
And we're staying on top of it, and we will start to experiment where we see it having potential.
Well, obviously they are.
I've not run the numbers on a projected basis for the entire industry, but I don't think they're coming down to a point at which it is going to be detrimental in any way.
And in fact, just from a movie-going experience, I think the consumer actually has a better experience when a particular theater or screen is more highly utilized than underutilized.
I mean, just think about seeing a comedy or an action adventure or a horror movie: you want that theater to be more full.
So, I think it actually improves the experience for the patron.
And just to expand on that, while, yes, some of the seat count comes down, the utilization goes way up.
So if you're in an underserved market, these tend to behave like putting a brand new theater in the marketplace.
So if you've got lower-quality assets in a market and you do one of these initiatives, you can actually bring new patronage back out again.
And we have seen that in quite a few of our new-builds.
North Hollywood is a great example of that.
That was a theater that needed to be fully repositioned.
And we didn't just go in and put seats, but we actually went in and re-did the theater from top to bottom.
And it absolutely revitalized that theater, and almost created a new film zone right there in the center of North Hollywood.
No, I'm not.
And the reason I'm not is I know what we're doing, and I know how disciplined we are.
And we simply are not going to do that as a Company.
We are extremely disciplined in looking at the new CapEx expenses for repositioning and re-seating theaters.
And I think also, it's likely that our competitors will do the same thing.
I mean, I can't speak for them, but I can only speak for ourselves.
And really there has been no change in our strategy here, and that is to look very carefully.
The results that we've had to date on any repositioning have either met or exceeded our going-in pro forma, and we'll continue to be that diligent.
Well, obviously we've got to be really careful in how we talk to our competitors, and so we don't share ---+
Yes, we don't share competitive information with what we're doing.
So all we can do is look at their actions and look at their publicly announced intentions.
And what I'm hearing, and also what we're just hearing at our trade organization, is that all of the companies are being careful here.
You know, they got burned before, and nobody anticipates or wants to see that happen again.
And I would just add to that point, to what <UNK> just said, I think the industry learned some invaluable lessons during the stadium seating conversions years ago.
So everybody is very cautious with this.
Even when you look at some of the most aggressive announcements of conversions, you're talking in the 30%-ish range.
So, the vast majority of all of our circuits will remain the core theaters.
And I would just say, we look at this as just one of the types of platforms within our option as we contemplate what's best for our market; this versus VIP, versus reserves, versus bistros.
There's a lot of different tactics we can employ to best serve a market.
It's just one of the strategies we have within our selection.
You know, I've been looking at local content for many years from a distribution standpoint, because we have distribution companies all over the world.
And local content has always been ---+ this is not anything new ---+ has always been important.
And it goes in cycles in local countries, just like it goes in cycles here.
So I would anticipate in the coming year and the year after that, that the same is going to take place, because it has been.
And Brazil is a country that is committed to local content, as is Argentina.
And we expect that we'll see similar results in 2016 and 2017.
I really appreciate that question, because it allows us to give a clarification.
We anticipate 2016 of being in the 100-screen growth aspect again for Latin America, so not half.
So if that wasn't clear, I'm glad to clarify that.
Yes, our assigned and committed theaters right now, that was just typically the way ---+ it doesn't mean that we don't have a larger pipeline of projects we're working.
It's just the current status of what's signed and committed.
We're still going to target around 100 screens of growth next year, similar to this year.
Thank you.
Well, there could be a lot that goes into that.
You know, some of that could just be the mix of where they're being developed.
Some of that is going to be ---+ we do see inflation again in these markets.
So some of this is going to be a contrast of that.
It's hard to say specifically.
It's going to fluctuate a little bit up and down, just based on the mix of where those screens are being built, as well as just ---+ country by country ---+ as well as just some of the local dynamics of construction costs.
Let me think about that.
No, I wouldn't say that.
I wouldn't look at it that way.
I think I would just come back to, it's going to be more based on the particular project that we're working on, the type of mall that it's going into, and some of the local currency construction costs that we're dealing with.
It's going to vary in the US, too.
Thanks.
I'll take the second half of that question, and I'll let <UNK> talk to the first.
Relative to pricing, typically, what our plan is, is to not change pricing right after the theater has been re-seated.
And we like to do that because it encourages sampling.
And what we have found is that once we get patrons to sample the new seats, they are absolutely willing to pay a premium.
So yes, we will increase pricing after the theater has been re-established and doing well, but it will not be in a significant way.
You know, it may go up $0.50, it may go up $1.
But typically, we go in with the same price to encourage sampling.
And I apologize, <UNK>.
Could you repeat your first question.
I see.
You know, that performance is going to range market by market.
I think some of the commentary you've probably heard in the marketplace regarding the types of performance and uplifts you see in those theaters, I would say on the whole, we're experiencing those same types of results.
But it really will depend market by market in the dynamics.
Okay.
Seeing no additional questions, we want to thank you very much for joining us this morning.
We look forward to speaking with you again following the fourth quarter.
Thanks again.
