Welcome to the Ryman Hospitality Properties’ Third Quarter 2015 Earnings Conference Call. Hosting the call today from Ryman Hospitality Properties are Mr. Colin Reed, Chairman and Chief Executive Officer; Mr. Mark Fioravanti, President and Chief Financial Officer; Mr. Patrick Chaffin, Senior Vice President of Asset Management; and Mr. Scott Lynn, Senior Vice President and General Counsel. This call will be available for digital replay. The number is 800-585-8367 and the conference ID number is 53603839. At this time, all participants have been placed on listen-only mode. It is now my pleasure to turn the floor over to Mr. Scott Lynn. Sir, you may begin.

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

Thanks, Scott and thank you everyone for joining us on our call today. As usual, I’m going to briefly touch on the quarter and our results before taking the opportunity to discuss bookings and express our excitement about how we’re thinking about the future. I will then turn it over to Mark for some more detail on the financials and our capital market activities. Now, let me start off by saying that our business for the third quarter came in pretty much in line with where we thought it would say for a couple of one-off small issues that I will talk about in a minute. In fact, we hit another milestone by setting new highs in terms of third quarter revenue and profitability which was noteworthy given the fact that our third quarter results for last year were really strong. We are particularly proud of the results given the unusual holiday calendar and the room renovation we undertook at Opryland. One issue that emerged late in the third quarter was a small spike in overall attrition that was focused on several groups underperforming but after review, it seems the underperformance was related to the shorter periods of the groups in question and we are comfortable that there is no systemic or discernible trend emerging here. From a margin perspective, we are again pleased with the way our hotels are currently being managed as we saw margin expansion consistent with the earlier quarters of this year. Notably, our hospitality segment produced same-store hospitality adjusted EBITDA up nearly 8% and same-store hospitality adjusted EBITDA margin up 180 basis points. During the quarter, we received $2.4 million in insurance proceeds related to a business interruption claim for the norovirus incident that occurred during the first quarter of this year. Absent this claim,…

Thanks, Colin. Good morning everyone. In the third quarter, the company generated total revenue of $252.8 million, up 3.2% from the prior year quarter. During the quarter, the company generated net income available to common shareholders of $26.7 million or $0.52 per fully diluted share. Net income in the quarter includes a non-cash settlement charge of $1.6 million for the company’s qualified retirement plan which was the result of increased lump sum distributions from the plan in 2015. The company grew profitability in the quarter generating $71.2 million in adjusted EBITDA, improving the EBITDA margin by a 150 basis points. For the quarter, the company generated $59.4 million in AFFO or a $1.15 per fully diluted share. Turning to the hospitality segment results, the hotels finished the quarter on a same-store basis with a RevPAR decline of 1.8% and an increase in total RevPAR of 1.5%. On a pro forma basis adjusted for the impact of the USALI accounting changes, comparable same store total RevPAR increased 2.2%. During the third quarter, we saw an increase in our group attrition rate to 13.7%. The increase in attrition during the quarter was attributable to a few specific large groups, and we see no indication that the industry is experiencing a systemic issue. Third quarter cancellations were our second best third quarter result and approximately 9,200 group rooms. Attrition and cancellation fees collected during the quarter totaled $1.2 million. We continue to see solid operating performance in margin expansion in our hotels with consolidated hospitality segment adjusted EBITDA increasing 9.2% to $67.1 million. Consolidated hospitality adjusted EBITDA margin increased to 190 basis points to 29.9%. On a same-store basis, hospitality adjusted EBITDA increased 7.8% to $66.2 million and hospitality adjusted EBITDA margin increased a 180 basis points to 29.8%. During the quarter, Gaylord…

Thanks, Mark. Can’t held this up, I want to go up script just for a second before Jackie we open it up for questions. One of the problems of being a public company in a sector like ours is that you get an issue or two with one or two competitors and the industry characterizes the world is disguise falling in. And several weeks ago, we witnessed tremendous volatility in REIT equity of raising interest rates in pending end of the cycle. But the big picture as far as we are concerned, as we look at our business, this is the thing that we focus on every single day, our board focuses on the same thing is that, the assets that we own in this company are extraordinary. They have tremendous revenue generating capabilities. We are seeing very, very little new supply that will affect these assets. We are seeing very strong group demand that’s in evidence by our bookings that we’ve reported to you again this morning and the lead volumes that we’ve reported to you this morning. And the tremendous forward book of business is setting 2016 up to be a record year for us. This year is a record year for us. And I am pretty confident that absent a macro event, 2016 will be a record year as well. We got a strong balance sheet, one of the highest dividends in this sector and we have the ability because of the real estate we own to further grow our world-class assets. By adding more capacity, demand continues to grow and we can add these spaces and generate very high returns on capital. And we got an entertainment business which owns legacy assets and is extraordinary. So from our perspective, things have never looked better and we’re very, very excited as a team and as a company about the future. So Jackie, let’s open up for questions.

[Operator Instructions] Our first question comes from the line of Chris Woronka with Deutsche Bank.

Hey, good morning guys. Wanted to ask you, we hear from a lot of your some of your competitors that they’ve been able to yield out some of their, I guess, what they call lower rate group business. Wondering if you are seeing any pick up from that and if that in turn allows you guys to become a little bit more selective in terms of what you’re taking?

Well Pat, you may want to give that question from Chris. Chris, this is Colin, good morning to you. Let me say this that all of the additional room nights that we got on the books for 2016, 100% of those room nights actually I think it’s more like a 110% of those room nights are indeed corporate room nights offset by a decline I think Pat in the [indiscernible] area. So our manager Marriott and our sales people are doing this. We literally, our asset management team are engaged with the sales team of Marriott, engaged with the leadership of Marriott on a daily basis making sure that we are calling the less profitable groups and installing groups that are more profitable to us. Pat, do you want to add to that?

Yeah, Chris, this is Patrick. It’s good to hear from you. Just to add a little bit to what Colin’s already said, we have much greater strength in our transient sector, it’s been a part of Marriott and so our need for some of the lowest rated groups is not as high as it was in the past. Having said that, we will always look across our calendars and if there are periods that we need to fill, need periods that are not hybrid demand, we will always consider groups that may be a little bit lower rated. We haven’t seen a large influx of low rated groups as a result of what other competitors are doing. Again, we are just looking across our calendar making the right decisions for our hotels based on what our needs are. But again because of our strength in transient, it’s a little bit less need for us and we can rely more on the transient side.

And Chris, this is one of the reasons why this morning we mentioned that we’re probably going to spend about $5 million adding to the pool complex in Texas simply because that is very quality business in the summer time. That simply last year we just didn’t have enough space, enough pools to accommodate the demand. So that’s an illustration of things that we are doing. We are also looking at potentially a much larger complex of that type here in Nashville because of the [indiscernible] leisure business coming to this market. So we are constantly pulling the levers of accelerating leisure where it’s economically feasible, de-accelerating the lower rated business and really focusing on the higher quality corporate business which generates very high outside of the room spend.

Sure. That’s great color. And just wanted to ask you, Colin, more of a theoretical question but as Nashville continues to evolve and grow and you are obviously the hallmark property in the market. Even though it’s almost 2,900 rooms now is it conceivable at some point down the road think about adding rooms there?

Well if you’d have asked me that question probably about eight years ago, nine years ago, I would have said you were rating that. But what is happening here frankly I’ve never seen it in the almost 30 years I’ve been in America, the transformation of a market that is taking place here in Nashville. And last month, the Nashville hotel, Pat, I think ran 90 points of occupancy and I really do think that as leisure demand continues to grow and we are seeing really strong group demand in this market. I think there is a possibility that we would look at more rooms here but I think if we did it, we will probably do it not as an extension or an expansion to make Opryland more complex to walk around. I think it will be sort of a standalone overflow hotels that would sit contiguous to this hotel.

Yeah and just to add to what Colin already said, the reasoning behind that is further supported by the fact that if we were to bring in a standalone brand it would have its own source of demand through its own distribution channel. So it could serve as an overflow facility to Opryland which so choose to move forward in that direction but it would also have its standalone revenue source or demand generator without Opryland when maybe Opryland is in a lower demand period.

Okay. Very helpful. Thanks guys.

Thanks, Chris. Thank you very much.

Our next question comes from the line of Shaun Kelley with Bank of America.

Hey, good morning guys. Thanks for taking my question. So, Colin, just wanted to go back to the – I know it’s like a relatively small number but I just wanted to go back to the attrition that was called out in prepared remarks related to the reduction in your full year forecast. So could you just give us a little bit more color on exactly what that was and because it does seem like what I’m trying to understand is a characterization. It seems like on the one hand it was higher than you anticipated but on the other hand it’s small in absolute numbers. Is that sort of what we should take away from the comment?

Yeah. You just summarized it in your last statement. Look, one of the things Shaun we try and do is to be very, very transparent in terms of what we’re seeing in this sector. We tend not to give surprises in this sector. We tend to be very open and transparent probably too much so. We probably share too much data. And so one of the things, we have a set of things that we focus on weekly, monthly in this business that we are constantly looking at. Things like cancellations in our business, attrition rates in our business because they tend to lead us to – it tends to be an early warning signal. We saw this occur in 2008 and so we observe and look at this stuff. And when we see attrition in a group or groups, multiple group spiking, we dig into those groups and understand is this group specific or is the group basically saying, oh my god, the world is falling and we’ve got to tighten our belt. And that potentially could spread to other group. So we do this as a general backdrop. So Pat, why don’t you give Shaun a little bit of color on what exactly we discovered here.

Sure. Hey, Shaun, this is Patrick. To Colin’s point, we always go into a quarter anticipating a certain level of attrition. Based on our history, we know that that’s just how the group business functions. Some attrition that we saw in the third quarter occurred after our early August conference call with you all and so we looked into the reasons behind that and I really put into three categories. The first would be group specific issues. These were some corporate association groups that either had a meeting that they were conducting that was competing with another industry event or they had introduced a new format to their meeting or they had just seen some attendance declines over the past few years specific to the group. So we have a few groups to fell into that category. The other category I would call out is lack of historical data where this is some association corporate or even SMART groups that we really didn’t have a solid history on and so the meeting planner has either created the meeting or it was first time they are staying with us and there was a lot more guessing and estimation going on, so some of the groups fell into that lack of historical data. And then the other one that we dug into to understand the best was those that saw attrition on shorter periods. These are groups that for whatever reason some of their attendees left early or didn’t arrive as early as we thought they would. When we dug into this real deeply, what we learned was that, some of it was just the day they had selected on which to hold their meeting. For instance, there was a large group that historically met over Labor Day instead they met a week later. As a result because there was no holiday, some of their attendees couldn’t stay an extra day and so they departed early. So there were a few groups that fell into that shorter period category. But overall as Colin’s already talked about, we looked across the three categories, shorter periods, group specific and the lack of historical data and walked away and said, look there is no real discernible pattern here. These are more issues that are really specific to the groups and while it was a little bit of elevated attrition, we feel comfortable that there is not necessarily a trend developing that we need to worry about right now.

And one of the reasons why I shared with the group here this morning Shaun, what we was thinking cancellations obviously back – when we met what actually took place in 2008 towards the end of 2008, early 2009 what we saw was attrition rates for companies, for organizations that were travelling was climbing, the cancellation rates were climbing at the same time and so - but we just not seen that. This was the second lowest third quarter in eight years on cancellations and lead volumes have jumped. Lead volumes are up 10% at bookings, meeting plan is absolutely committing meetings in contract form. So we – our conclusion on this is that it was circumstantial to these groups period.

Really helpful and I appreciate the detail. So two more small things, the first one is, we’ve gotten the question over and over again from investors about group exposure from energy related companies like the Texan and then maybe if you could just provide us the thought across the portfolio as well, just directional would be great if you have that.

We have very, very little energy related business on the books, but Texan is having by far its best year. I suspect that Texan will have a very good fourth quarter next year. The Texan will have again I think its record year. So I really do not energy is not consequential to us.

Yeah and the question came up on the last call, we went back and looked, it is less than 5% of our mix of group business. It is not something we worried about and we’ve looked at the Dallas market specifically and we continue to see strength across the Dallas market. So despite some of the challenges that are going on in the energy sector, we are very bullish on the Dallas market just because of the performance that we’ve seen at our Gaylord Texan property this past year.

Great. And my last one, apologize for hugging the floor. Colin, you get some really interesting date about October and that’s always like super appreciated given some of the volatility we are hearing about October from your competitors. So my question is, I just wanted to be clear, you said if I caught it correctly was it 16% RevPAR growth in October across the portfolio and then 13% in total RevPAR, where those the numbers?

Yeah, you heard it right and just north of 85 points of consolidated occupancy. It was absolutely tremendous month, but we knew we were going to have it because of the tremendous book of group business we had on the books for October.

And you are still bringing down the full year outlook despite those numbers. So it does imply some pretty meaningful deceleration in November and December. Is that correct?

Well let me be clear. I asked Mark last night to share go back and remind me what our guidance was at the beginning of the year, what occurred through the year and where we are today. And in fact our total consolidated EBITDA guidance that we issued in February, we increased it in May because of the strong second quarter we were having and we knew that we were going to have a strong fourth quarter. And I think actually guys we said that publicly. And when you look at total consolidated EBITDA with this minor adjustment to the midpoint we are actually a couple of million dollars up on where we were in February of this year. So our business is so predictable and it’s the small things like a spike in attrition and forcing a 500 room reverb start to finish in a three month period that has led us to the conclusion that we should talk about the very insigficant impact that these things have on the overall profitability. So that’s where we are.

And let me just add a little bit of additional color for you on the fourth quarter. Colin’s already talked about really great strength that we saw in October and we don’t – it’s not that we expect November and December to be weak. If you go back and look last year, RevPAR in November was 14.6% year-over-year growth and December was 17.1%. So there is really two thing that work. Number one we have extremely tough comps because we had so much growth in both group and really solid transpire [ph] performance last year. So bumping up against that we still expect good growth but not necessarily to the level that we saw last year. And then second because of the attrition we saw in the third quarter, we think it’s prudent to go ahead and make that we planned appropriately for the fourth quarter from an attrition perspective. So if attrition comes in lighter than what we planned for, then there could be some upside for us but right now we’re just being prudent.

Thank you very much.

Last December we had a – it was the best month we ever had in the company’s history.

Correct. $103 million of revenue from my memory.

Anyway next, Jacquie, sorry.

[Operator Instructions] Our next question comes from the line of Bill Crow with Raymond James.

Good morning guys. Colin, I wanted to just take a big picture look at the group business not necessarily specific to your hotels but the company’s unique strategy and the rotational model allows you to track the same groups year-after-year and I think Patrick alluded to that, the history of the groups in one of his prior answers. So one of my question is, if you do indeed track same group dynamics, what’s going on with attendance overall at these group spending trends, are you hosting more groups with fewer attendees, fewer groups with more attendees and start there.

Well, my – I don’t have thing at my fingertips. The empirical data to be explicit about more groups or less groups, but I would say to you given the way our group book of business is growing and looking at where the majority of our business is being booked, I think what we are seeing is a lot more groups in that 300 to 600 at peak and a lot more corporate business at peak. But we can pull that data and try and get a little bit more granular for you but I think our sales people are very comfortable with the quality of business that we are booking and the performance of these groups. Pat, do you want to add to this?

Sure. To Colin’s point, he is correct. This has been a dynamic business and have been in place for the past six years or so that we are hosting more groups with a fewer attendees. Now we’ve seen some growth in attendance numbers and you’ve seen that played out in our attrition numbers over the past couple of years. But to your question specifically as far as how groups are performing, I would tell you that as always it depends on the group but I would tell you even in the third quarter we saw some group set some new records for their own spend levels and I can’t name the specific groups but they are groups that are brand customers, they’ve been rotating to our business for a number of years and in the third quarter a few of them set outside the room spending levels that we just have never seen from number four. So there are some really great things to point to that are encouraging but some of these groups are still feeling very good and spending at very high levels.

Patrick, have you seen on the margin the industry categories change as the economy has going to be evolved over the last year or two. You said not much exposure to energy, so we will leave that aside but any changes to tech or pharma or manufacturing or anything that stands out?

Bill, I mean yes, you’ve seen that in some of these corporate room nights that we’ve been booking so well over the past two years. Pharma has been a great source of last minute bookings if we have an opening that they can book into. Financial, Tech have both been very strong as well. So they’ve modestly grown because that’s where the opportunity is right now but we haven’t become overly dependent on them. I guess I’ve just clarified that.

And it’s hard for us to truly understand. It is the increase that we are seeing in pharma, financial services, technology. Is the increase due to just the underling vibrancy of this sector versus Marriott’s long term relationships that they have, these corporate relationships because of the scale of this business that was so different to the corporate relationships that we had when we were standalone Gaylord brand. But I do know the result whether its vibrancy at the sector or whether it’s the relationship, we are seeing a lot more business.

And finally from me Colin, is there any change in the relationship between the amount of meeting space booked and the corresponding number of rooms booked and I ask you that because obviously everybody’s focus seems to be focused on [indiscernible] and events like Comm/McCann have come out and I know the last time you hosted Wall Street for an event that was a similar sort of event going on. And so do you see fewer rooms relative to meeting space?

I still have pictures of it by the way. The answer to the question is, we are migrating to corporate quality business away from space hogs. I think overall Patrick, I don’t think we are seeing a major change in meeting space per attendee. But one thing that we do believe, as we get these hotels operating to all its 80 points of occupancy which if we hold where we are through the rest of this year, we’re going to be pushing somewhere in that 78 points, 79 points of occupancy next year. We’re going to be doing just north of 60 points of group occupancy in these hotels - 60%, 64% group occupancy in these hotels and the problem is and this is something that is hard for probably most of you and your brother to get your arms around. But the problem is that our space drives room nights, it’s not room nights drive space. And so the issue for us is if we have another 50,000 or 100,000 feet of flexible meeting space in one or two of these hotels, we can drive occupancy. And so what we are focused on is the quality of these groups, the meeting space that they basically take and how we can lay on more groups by having 50,000, 60,000 of net meeting space in one or two of these hotels.

And Bill, the reality is if anything, meeting planners want more space, they always want more space, they continue to ask for more space and it’s our job to make sure that we hit the right ratio in place so that we have additional space to sell more rooms. And we have been working with Marriott over the past 12 months specifically on a couple of initiatives to drive greater efficiency and utilization in our space. And so whether it’s – we’re trying to call back space from groups to make sure they are using the space efficiently so that we have additional space to sell to more groups or whether it’s just tracking to making sure we understand how our space is being occupied and how it’s been utilized. So our initiative is underway to drive our utilization more efficient but meeting planners continue to ask for more and more space.

Great. Thanks for the time.

Thanks, Bill.

That was our final question. I’d now like to turn the floor back over to Colin Reed for any additional or closing remarks.

Jackie, thank you and thank you everyone that was on the call this morning, really appreciate you taking the time and we – I know Mark and I will be doing the REITWorld Conference in Vegas, Mark and couple of three weeks and then we’re planning a trip to New York. So we look forward to being with our investors and answering more of your questions and helping you understand the tremendous future that we think our company has. Thank you very much indeed everyone.

Thank you. This concludes today’s conference call. You may now disconnect.