United Parks & Resorts Inc (PRKS) 2014 Q4 法說會逐字稿

Good morning, ladies and gentlemen, thank you for standing by. Welcome to SeaWorld Entertainment's fourth quarter and year end 2014 financial results conference call. My name is Robin and I'll be your conference operator today. At this time all participants are on a listen only mode.

(Operator Instructions)

As a reminder this conference call is being recorded. I would now like to turn the conference call over to Gene Ballesteros, Senior Director of Investor Relations and Corporate Treasurer, please go ahead, sir.

Thank you. Good morning and welcome to our fourth quarter and full year 2014 earnings conference call. Today's calls is being recorded and webcast live. Our earnings release was issued this morning and is available on the investor relations portion of our website at SeaWorldEntertainment.com.

Replay information for this call can be found in the press release, and will be available on our website following the call. Joining me this morning is David D'Allesandro, Chairman of the Board and interim Chief Executive Officer; and Jim Heaney, our Chief Financial Officer. They will discuss important factors impacting the business, and review our financial results.

Before we begin, I would like to remind everyone that our comments today may contain forward-looking statements within the meanings of the federal securities law. These statements are subject to a number of risks and uncertainties that could cause actual results to be materially different, and we undertake no obligation to update these statements.

In addition, on the call, we may reference certain non-GAAP financial measures. More information regarding our forward-looking statements, and reconciliations of our non-GAAP financial measures, the most comparable GAAP measures, are included in the earnings release and can be found in our filings with the SEC.

Now, I would like to introduce David D'Allesandro. David?

Thank you Gene, good morning everyone and thank you for joining us today. I going to offer some brief opening comments and then Jim Heaney will provide details of our 2014 financial performance, before we take your questions. Today marks my six week anniversary as interim Chief Executive Officer.

As I said weeks ago, my top priorities in this interim role are twofold. One, to lead the search for a new CEO with our Board of Directors; and two, to oversee the day-to-day operations of the Company. We're well into the process of conducting a CEO search. I'm personally spending significant time on the search, and we have retained a leading executive search firm to assist us in this effort.

I won't, of course, try to characterize the advancements to date, other than to say we're making good progress, and are on track to complete the search within the six to nine month timeframe announced in December.

Second, regarding your day-to-day operations. As I said in December, we are focused on improving the fundamental performance of the businesses. Already, with the actions taken today, we are starting to see early signs of improvement in our business trends. That being said, I need to caution everyone that we are very early in the year, and need to get through spring break and Easter, before providing a view of our full year performance.

With that, I will turn the call over Jim, to walk you through our 2014 financial results.

Thank you, David. Good morning everyone. Let me start by saying we closed out 2014 how we expected to. Our top-line trends improved in the fourth quarter, but not where we want them to be in the long term. Despite a very challenging year in 2014, the Company was able to return significant value to shareholders, to paying out $72 million of dividends and repurchasing $66 million of our stock.

We have had an encouraging start 2015, with the majority of the first quarter of the fiscal year is ahead of us. For the full year 2014, the Company generated revenue of $1.378 billion, which decreased 6% from the $1.46 billion in 2013. The decrease in revenue was driven by a 4.2% decline in attendance, and a 1.5% decrease in total revenue per capita.

Attendance for the full year 2014 declined, as the negative trends that began in the second quarter 2014 at our destination parks in San Diego and Orlando, extended into the third quarter. The attendance trends for the Company improved in the fourth quarter of 2014, with attendance down 2.2%, versus the 5.2% decline in the third quarter.

A 1.5% decrease in total revenue per capita from $62.43 in 2013, to $61.51 in 2014, was primarily a result of an unfavorable change in park attendance mix, and an increase in promotional offerings. Cost of food, merchandise and other revenues decreased by 5%, from $114.2 million in 2013, to $109 million in 2014. As a percentage of total revenue, these costs increased slightly from 7.8% in 2013, to 7.9% in 2014.

Operating expenses decreased by 2% from $743.3 million in 2013, to $727.7 million in 2014. This decrease in the operating expenses was primarily a result of a reduction in variable labor costs, and other cost mitigation efforts employed by our park operations team.

SG&A expense increased by 1% from $187.3 million in 2013, to $189.4 million in 2014. The increase is primarily related to marketing costs associated with new reputation initiatives and our SeaWorld 50th anniversary celebration. These costs we're partially offset by the elimination of advisory agreement fees, due to the termination of this agreement in 2013, and a decrease in equity compensation expense, when compared to the prior year.

In 2014, we incurred $11.6 million of cost, associated with our restructuring program, which we announced in December. The restructuring involved the elimination of approximately 300 positions across our 11 parks and corporate headquarters, in an effort to centralize certain operations, reduce duplication of functions and increase efficiencies. The restructuring is part of our previously announced, company-wide cost initiative to deliver $50 million of annual cost savings by the end of 2015.

Also in the fourth quarter of 2014, we incurred $2.6 million in separation costs, pursuant to the previously announced separation of our former CEO and President on January 15, 2015.

Adjusted EBITDA, a non-GAAP measure defined and reconciled in our earnings release, decreased 16% from $439.1 million in 2013, to $370.1 million in 2014. The decline in adjusted EBITDA was primarily a result of the decrease in revenue.

Appreciation and amortization expense increased by 6% from $166.1 million in 2013, to $176.3 million in 2014. This increase was due to the impact of new asset additions, along with accelerated depreciation on assets impacted by our cost reduction initiative, partially offset by assets that are now fully depreciated.

Total interest expense decreased by 10% from $90.6 million in 2013, to $81.5 million in 2014. The decrease primarily reflects the effect of amendment 5, to our senior secured credit facilities, which reduced the interest rate on our term loan, as well as the impact redeeming $140 million of our senior notes, and the repayment of $37 million of our term loan, with a portion of the proceeds from our IPO in April 2013.

GAAP net income decreased by 4% from $51.9 million during 2013, to $49.9 million in 2014. Diluted earnings per share decreased from $0.59 in 2013, to $0.57 per share in 2014. Adjusted net income, a non-GAAP measure reconciled in our earnings release, was $59.4 million in 2014, or $0.68 per diluted share.

We ended 2014 with $44 million of cash and cash equivalents on our balance sheet, with no amounts drawn on our revolving credit facility. Total long-term debt, including total maturities, was $1.612 billion. Our net leverage ratio at the end of 2014 was 4.25 times adjusted EBITDA. Based on our debt covenant calculation at the end of 2014, the Company has $120 million of capacity for a certain restricted payment in 2015.

And an update to our previously announced share repurchase program. During the fourth quarter of 2014, we repurchased a total of 156,000 shares at an average price of $17.50 per share, and a total cost of approximately $15 million. This leaves $235 million available for future repurchases under this program.

In terms of guidance, we intend to issue full year 2015 revenue and adjusted EBITDA guidance during our first quarter earnings call in May. By then, we'll have a view on our performance during spring break and Easter, and be in a better position to provide a perspective on our full-year performance. We are refining our capital expenditure guidance for 2015 from the previously provided range of $185 million to $195 million, to $180 million to $190 million.

Operating expenses are expected to be flat to down slightly in 2015, as the impact of the $50 million cost reductions is partially offset by an increase in marketing and other expenses, primarily by labor.

Finally, as we indicated in the past, the Company still intends to pursue refinancing our senior notes. Our expectation is, the refinancing will occur sometime in 2015, dependent on market conditions and other factors. That concludes our prepared remarks. We will now open the call up for questions. Operator?

Thank you. We will now be conducting a question-and-answer session.

(Operator Instructions)

Our first question is from the line of Alexia Quadrani with JPMorgan. Please proceed with your question.

Thank you very much. Just a couple of questions.

I guess, at first, you could talk about the tourism, or the traffic in general, in Orlando, in the December quarter? And how much you think was a lift in that marketplace, versus efforts you guys have made internally to drive a bit of better attendance in the December quarter? And then, any comment on any promotional activity you may be doing either that impacted the December quarter, or may impact the first half of 2015?

Alexia, this is David D'Allesandro.

As you know, we don't break out our parks individually. But it is fair to say that, all the parks contributed to a stronger December. As you see, our trends were up.

As regarding the promotion, we have been, both in December and January, pushing our past promotions, as we now move into Fun Card season as well. And both of them have contributed to stronger trends for us at this stage. I will caution everybody that only about 8% of our business for the year is in, through February. But again, we are happy with the promotions we have run and the trend line we are seeing so far.

And just if I could squeeze in one more.

Any insight you can give us, in terms of the timing of when we should suspect the realization of some of these cost savings, as how they flow through the year?

Sure, Alexia. This is Jim.

The $50 million target we put out there -- we expect to have all that banked by this year. So if you are looking at projecting our expenses for this year, all that will be realized in 2015. And as you heard my opening comments, we expect to see operating costs to be flat to down slightly, in 2015. That's a net effect of the $50 million cost reductions, offset by some of our increases in marketing and reputational spending.

So kind of flat -- I mean consistent -- throughout the year. Not necessarily loaded in one half, versus the other half?

Yes, the $50 million will be realized largely, at flatly, through the quarters. But some of our marketing and reputational spending will be pulled forward because of the timing of when we're launching our programs. Please be careful when you layer out those two factors.

Okay, thank you very much.

Our next question comes from line of Felicia Hendrix with Barclays. Please go ahead with your questions.

Good morning; thank you for taking my questions.

David, so you've been there for six weeks, today is your anniversary. I'm wondering what's changed in the six weeks since you've been there? And in the release and in the prepared remarks, you all talked about seeing early signs of improvement. I was just wondering if you could be more specific there?

As I said, what we are seeing is, we are running the business, very close, as I said back in December, to the fundamentals of blocking and tackling. So, we're spending a lot of time on attendance, on the quality of attendance, and what I would call some basic marketing work in each park, depending on what the park's needs are.

And, the trend lines we see -- now, let's recall that all of our parks are not open, here in February. But the three major parks -- Orlando, San Diego, and Tampa -- are all trending in a positive fashion. But it's early, so it's one of the reasons we haven't issued guidance yet, is we would like to see the pass business through Easter and spring break. We would like to see these promotions continuing for another six to eight weeks. And we're running a lot of special events in the parks, which are giving us a lift, as well.

We're very pleased with what we see so far, but until we have more under our belt, we are in a wait-and-see attitude. But every week, every day is spent on the fundamentals of driving the business in a way we see appropriate for each of the individual parks.

Thank you. I guess maybe I should have been a little more granular.

And I know it is hard, because it's early in the year. But last year, the strategy was to yield manage and try to focus more on revenue per cap, and perhaps not get some of the lower-paying folks. You know, get them out of the park. So now, as you're looking your strategy this year, your yield management -- clearly, it seems like the past program is important. But in terms of the mix in your parks, how are you thinking about that, this year?

I think Jim and I will both answer that question. I'll let Jim go first.

Good morning, Felicia.

The way to look at 2015, it's not just a single strategy. There's different periods of the year we employ different pricing and promotional efforts. Early on, through February, we are really dependent on our pass business. We're trying to build our pass base. We have a lot of consumer events in the market. We are very pleased with what we're seeing.

And then, as you transition into spring break and Easter, we become more tourist-focused, which is a whole different game. And then pricing becomes a bigger player. But early on this year, we're really focused on building our pass base, building that base of attendance that will pay dividends through the rest of the year. And then we'll transition into the latter part of the spring, where tourists become more important.

I agree. I think that answers your question.

Yes, that does.

And then, Jim, just housekeeping: you lowered your CapEx guidance, slightly. Is there anything to look into that?

No, it was really refining. We know CapEx is a big KPI, and big driver of our free cash flow. So we wanted to update that. But you shouldn't read anything structural in the $5 million reduction.

Okay. Great Thank you so much.

Our next question comes from the line of Tim Nollen with Macquarie. Please go ahead with your questions.

Thanks. A couple things, please.

I wanted to ask first off about your promotions. You laid out, during your IPO proceedings a pretty clear plan, I thought, to reduce promotions and freebies and things, and really to drive per capita numbers. And you had very good per capita numbers in your first year as a public company. Those numbers have come down a bit since then. I just want to understand your interest in doing these promotions. Now I just wonder what the longer-term thinking is on promotions versus driving per capita spending.

And then secondly -- if you could give us any update, please, on any of the new projects that you have spoken about a few times, whether it's Blue World, or international expansion? Anything you might want to say on any of those, please?

We are certainly very conscious of our need to drive attendance to our parks, and to make certain that we are getting a good spread of demographics, as well as geographies. So some of the promotions we have put in place, some are discount promotions, some are very simple pass promotions. And we are also, now, guiding ourselves into a more aggressive, full-branded marketing campaign, which we will launch in the coming weeks. And a new reputational campaign, which we are also launching -- all of them working together with some promotions. And, as we enter the spring season, we will be taking a much harder look at where we think we have pricing opportunity.

But our strategy is simply: let's get people into the parks. Let's re-establish our pass base. And then, let's market more aggressively on the domestic side, with additional marketing programs. And take a look at whether or not we have pricing opportunity, as we go forward. It's not an interim process. We consider it an integrated process.

As regards the two subjects of Blue World and our international programs, we continue to be in the same place I said in December, which is, Blue World is on track. We believe in the project, and it is proceeding exactly according to plans you've seen in the past. On the international side, we continue to look at our Mideast project, and have recently had a series of discussions, and we will have more to talk about in the next quarter.

Okay, so no real updates on that now. Everything on track as before, and you will update us, when you have more.

Yes. The update is only that we'll have more to talk about next quarter.

Okay, thanks.

Our next question comes from line of Tim Conder with Wells Fargo. Please proceed with your questions.

Thank you.

Regarding the season passes, you just alluded to that a little bit. I know traditionally you focused -- that has not been as much of a priority of focus as say, some of your more regional, other folks in the industry. But can you give us a little bit more color -- how you are approaching that differently, here, for 2015 versus 2014? It seems like in the past, you have looked at that more as a resident of the state in which the park is in. Just a little more color on that would be great.

And then, how do you feel, given that you really don't have anything new in Orlando this year, but does what the recent pricing by Disney, in the market, give you a little bit of cover? And a little bit of breathing, relief room?

And then, finally, to followup on the discounting -- in certain parks, does discounting really make that much difference? Or is it better just to try to preserve the price, and pair it up with some additional value added? Whether that be in-park spending credits, or free parking, or other things, rather than just to promote only on price? Thank you.

Tim, this is David. Let me take the last question first.

You know, on pricing, Disney just went up this past week. And Universal, I don't believe has gone up yet, but we would fully expect them to follow. We are not interested in necessarily following, to follow, just yet. But we think there may be some room there. But again, I think we would like to wait until we see how the quarter goes. And, as we rebuild the local past base, which I'll come back to, because that was one of your questions.

But we agree with you, actually, in the question about, there are some ways to do promotions, as we have in San Diego this year, where we are doing a free parking promotion, associated with our pricing, and it's working very well. So it is a relatively low-cost promotion. And there are other promotions that are more discounted. It really depends on park to park and seasonality.

One of the things we find in Orlando, for example is, in Orlando, and in Florida in general, people really follow past pricing. They follow it very closely. So you have to be careful about jumping too fast. But also you want to bring some value. And people do pay attention if you're giving away a free meal, for example. Or, there's a pass -- one of the things that's actually working, Tim, is, we've been doing special events in the Orlando park, like the Christian Wave, which we're doing right now, which has been very successful, from our perspective. What it does is that, people are paying our current prices, but they are often -- it's helping people to buy a pass, who are saying, look, I may as well buy a season pass, rather than pay the one-day ticket charge. And now we're getting -- so hopefully will get more of new business.

We are having success, also, in San Diego doing the same thing, on our Lunar Year promotions, which are happening as we speak. The last, I think it's four weeks, this year. We have two more weeks to go.

So, there is a mix and match program going on, depending on park. But everything is not -- we are not going to try and pull on that string which says, let's just go 40% or 30%, on a discount. We don't see that as wise, and we don't think we should train our passholders and potential passholders, to just expect us to go to lowest price.

I think I kind of answered your pass program question, too. Did I answer that for you, Tim?

Yes. I mean, is there more of a focus on the passes at, say, the outside of Orlando and San Diego? Or, is it just across the system in general?

No, we see the pass program -- we have a very high percentage of locals and near-bys and Floridians in Tampa. So the pass program has always been very important there. So basically, if you look at it, it operates more like a regional park, so it continues to be a very important program, particularly when you match it to our water park. And again, we see our pass programs as being reasonably healthy at this stage of the year.

Meaning up, would you say single digits, on a year-over-year basis?

Meaning, reasonably healthy.

Okay.

You know, we don't want to create false expectations, because we are running a business, as you might expect us to, with some caution as to having positive news, and not trying to extrapolate that for the year, with such a small percentage of our business coming in at this time.

Okay. And then, as it relates to how you view the Company collective, and maybe just the brand SeaWorld and non-SeaWorld branded parks -- it appears, obviously, it's very clear that the problems are well documented in Orlando and San Diego. But the other park's collective were up in attendance, and up in EBITDA, for the year. Any color on that?

Hey, Tim. This is Jim.

You're going to get the expected answer, that we don't break out individual park attendance. But when you look at what happened to the Company in 2014, and the magnitude of the attendance drop, we've mentioned before that the bulk, or all of that, was at the two SeaWorld parks, in San Diego and Orlando. So you can extrapolate from that, maybe, what you're (technical difficulties) to answer that question. But, beyond that, were not going to provide individual park numbers.

Okay. And from a perspective of, I guess, how you view the SeaWorld brand, versus non-SeaWorld branded parks, from a cash flow, and just the overall part of the collective?

The SeaWorld parks are very profitable, extremely profitable. They're just not as profitable as they were a year ago.

Okay. Let me just be more direct here. Some have put out that there could be value unlocked by separating the SeaWorld branded parks versus not. How do you view that -- as the non-SeaWorld branded parks -- as a component of the cash flow, overall to the collective?

What I would say is, there is a lot of synergies and benefits in having a full portfolio of parks. There's a lot of interplay between our Tampa and Orlando parks, whether it be ticketing products across both brands. We do similar things across our system with synergies on marketing, purchasing, and operations.

We've actually gone in the opposite direction, Tim, if you look at our cost savings recently, where we have consolidated a lot of functions from the parks to a central location back in Orlando. Which so far has been working very well for us. So there are an awful lot of efficiencies.

We've also just consolidated all of the marketing to Orlando, for efficiency reasons. And also, so that we get an opportunity to do cross-promotions when we need them. We are well aware of some of the theories about breaking out the parks separately, or even separating out the SeaWorld brand. We just don't see that as beneficial to the Company.

Okay, very helpful, gentlemen. Last question: Don, you made a little commentary about more to come on the international. It seems like, what you just said in the answer to the prior question that was asked on that versus 90 days ago -- it seems like something's materially changed. Until 90 days ago, it was, well, we are looking further out with the Park in the Middle East. And we wouldn't really expect a lot until maybe the back part of the year.

Is there any additional color, what you can give? And again, it sounds like the tone has changed, more for the positive, on the international front.

I would think it is fair to say we have made progress. You know, on a scale of 1 to 10, I can't can tell you in any definitive way. But we have certainly made progress, and expect to know more and be able to report more next quarter.

Okay. Great, thank you, gentlemen.

(Operator Instructions)

The next question comes from the line of Afua Ahwoi of Goldman Sachs. Please go ahead with your questions.

Good morning. Just two for me.

First, maybe can you give us more detail on the CEO search process? For example, have you narrowed down the list of candidates? And, what sort of skills are you looking for exactly?

And then, second question: I think you mentioned a little bit, that you were spending on -- I can't remember the exact phrase, in repairing the brand image, or public relations. And maybe, could you give us some more specifics of what that will entail? What sort of initiatives are behind that? Thanks.

Yes. We continue to -- I don't have any new news on the CEO search, except for what was in the release, except to say that we continue to look at a number of industries. We're looking at people that have a wide range of skills -- certainly marketing skills, financial skills, and the ability to manage multiple geographies and multiple brands. And the search has delved into all the areas we said we were going to, in December. So, the cruise line business, the resort industries, the ski industries, some of the sports and entertainment industries, the theme park industries, and the hotel businesses, in general. So we continue to go down that path. I, of course, can't talk about how many candidates, or where we are in the process, except to say that we continue to be on track for the six- to nine-month period.

As regarding the reputation spending, we do have a little bit of news here. We've been working over the last 69 days quite diligently, on both a marketing campaign for SeaWorld -- that is our normal marketing campaign, which will be breaking sometime in late March -- and we have also spent a lot of time in research and marketing on the reputation side, and we'll breaking a campaign no later than April, in multiple media and social media and print; digital, of course; and the probability of television -- a reputation campaign that helps restore some of our reputation.

And it can best be described as a campaign about the truth about SeaWorld. And we are very eager to get that into the marketplace. But, we want to do it appropriately, against what we believe the right messages are. There's seems to be no shortage of advice on how to do this, and have been from both professional people and others. So, we have sorted through it and expect to be out in the marketplace by no later than April 1.

Okay. Thank you, and actually just one followup.

For the fourth quarter, I know Six Flags, Cedar Fair, I think some of the others, benefited from the way Halloween fell. And maybe, is there any way you can help us quantify what that meant for you, having that sort of extra weekend, or extra weekend to market Halloween? And, if any of your holiday in the park events were bigger than last year? Just to try to get a sense of that.

What I can tell you, again, is our attendance trends improved in the fourth quarter. A big part of that improvement was our strong performance for both Halloween and Christmas, at all of our parks, not just a specific park. And we also benefited from the opening of Falcon's Fury, which opened in September. Those were the real tipping drivers of our improved attendance.

Thank you.

Our next question comes from the line of Barton Crockett with FBR Capital Markets. Please go ahead with your questions.

Okay, great, thank you for taking my questions.

First, just on the improving trends that you're seeing here -- I was wondering if weather has any factor in this? Helpful, or a headwind? Or if it's really not a factor in the fourth quarter and the positive start your seeing to the year.

Hey, Barton, this is Jim.

No, weather hasn't been a positive or a negative (inaudible) in the fourth quarter and what we're seeing year to date through 2015.

Okay. And I know that the trends look positive. But you know, things have surprised us here over the past year at times. So I wouldn't expect this to happen, but just for scenario purposes -- how much revenue headwind could you absorb in 2015, before you start to put some pressure on your ability to sustain the dividend?

Well, I'm not going to do the math for you. But the key numbers would be, our dividend commitment would be $76 million. Our free cash flow -- and you know what our free cash flow was in 2015. We provide a guidance on our CapEx and our operating costs. So, with that information, you should be able to do the math.

Okay. All right.

And then, the path for you guys has been that, when there has been animal issues, you've recovered, sometimes pretty quickly, in the following year. How do you feel about it this time? You're seeing some positive trends starting into the year. I'm not hearing so much from the legislative front in California, although maybe that could change. Does it feel like we could see those kind of concerns fade, in terms of the view of SeaWorld this year? And, maybe, potentially see the kind of snapback we've seen in the past?

I don't think we've taken any of those issues for granted. To our knowledge, the bill that was introduced in California, it's already been announced that it is not being reintroduced. That doesn't mean there won't be legislative action somewhere. I think, we are assuming that there will be some anti-SeaWorld activity, which we are prepared to deal with. But again, I think until we get into the full season of particularly the domestic tourist business, versus the local business that we are in today, I don't think we have a real good understanding of what impacts we may or may not have. Which is why you're hearing from us, what I would best call cautious optimism.

And I think you recognize -- I'm hoping, at least -- how straightforward we were with everything that is going on. So we are trying to set a tone here that we believe is appropriate for what is happening in the business, and a wait-and-see attitude as we go through each quarter.

Okay. That's great, thank you.

Our next question is from the line of Jason Bazinet with Citigroup. Please go ahead with your questions.

Thank you so much.

In the release, in footnote J, you were kind enough to talk about the $10 million restructuring benefits, and how there is a delineation between the senior secured credit facilities, versus the senior notes, in terms of whether or not you can get credit. And my question was, how does that flow down to the restricted payments basket? If you could just talk about that a bit, in terms of that leverage ratio test? Is it more like the senior-secured, or is it more like the senior notes?

Well, the $10 million is a one-time benefit that we were able to take in 2014. We won't have that in 2015.

But just, conceptually? Can you have hypothetical savings benefit you on the restricted payments basket test or not?

Well, you know our restricted payment basket is a function of our leverage ratio. At the end of 2014, our restricted payment capacity is $120 million. And as you heard earlier, we have a roughly $76 million dividend commitment per year. So at our current leverage ratio, we have plenty of headroom to pay dividends, and do buybacks.

I totally agree. But my question is a simple one: Can you influence the leverage ratio test, under the restricted payments basket, on potential savings, the way you can on the senior secured credit facilities, but you can't on the senior notes?

The covenants regarding that are fairly similar. And if we do a refinancing, then that would become less relevant.

Okay. All right. I'm not sure you answered the question, but okay, thank you.

Well, I'm not clear on what exactly you're asking. We can do more on the followup call.

Sure.

Our next question comes from the line of Robert Fishman with MoffettNathanson. Please go ahead with your questions.

Good morning. A couple questions on CapEx.

Can you update us on how many new attractions are scheduled right now, for 2015, after the opening the nine last year? And is there any change on how we should think about the 2016 and beyond CapEx levels? I think previously you've said for it to be in the $215 million range?

Sure. I can talk about our CapEx profile, and then maybe David can go through our attractions. We provided guidance for 2015. When you look at a longer run-rate level of spending, with Blue World included, we would expect a step up of between $20 million and $25 million going forward on top of what we've provided for 2015. And that step up would, obviously, run through the period when the Blue World projects are under development. In San Diego, we break ground in 2016. And the first one would open in San Diego in 2018.

There are a number of new attractions this year. One of our larger ones is in Busch Gardens Williamsburg. There is a new coaster called Tempesto, and it marks the 40th anniversary of the Park. Sesame Place -- we have our 35th birthday celebration; festivities all year. In Busch Gardens, Falcon's Fury really didn't kick in until September, where we saw a lot of the lift for the last quarter. So we'll have a full season of Falcon's Fury, which is the giant drop tower, which has been very popular in Tampa. At Adventure Island, we have a new, something called a Colossal Curl slide. And in San Antonio, a new sea lion habitat restaurant and a new Clyde & Seamore Sea Lion show. In Orlando, a new Clyde & Seamore Sea Lion Show High and a new interaction program in an area for our dolphins. And those are the main attractions in 2015.

Okay. Can you share for us, your updated thoughts on competition and taking share? And how you think about the competitive landscape in 2015? And on a somewhat related note, is there anyway to figure out if Disney's My Magic Bus is having a meaningful impact on your attendance, given Disney's belief that it's helping drive their own business in Orlando?

You know, the good news is, there appears to be a lift in Orlando in general. So I think everyone is benefiting from the lift. And let's be clear -- there are a couple of colossal CapEx attractions here, between Harry Potter and Disney, that we have seen the impact from in 2014, which we have already talked about. In fact, we expect to be holding our own in Orlando.

Each of our major park cities has its own competition. So we have a new attraction in Williamsburg. We have a lot more weekend activity and special events in San Diego. So from a share standpoint, it's a lot harder to talk about the benefits, because the numbers are so sketchy on share. But we feel very competitive in most of our markets. And frankly, when you're not driving a lot of big CapEx in Orlando, you don't have a choice but to market, promote, go through past business, and do a better job in pricing. That's the way you, at least at a minimum, maintain share.

And on My Magic Bus?

I'm sorry?

Disney's My Magic Bus -- is there any way to figure out if that's having any impact?

I can speak to that.

Disney has been implementing strategies to sequester guests on their property for a decade now. Between their ticket pricing structure, their ground transportation systems, My Magic Bus is just the third or fourth in a series of those initiatives, which arguably, have been successful. But that individual component, on its own, I don't think has hurt us, as much. I think you know, if something is hurting us, it's the cumulative impact of all those things together.

Okay, thank you, guys.

(Operator Instructions)

The next question comes from the line of Josh Borstein with Longbow Research, please go ahead with your questions.

Hi, this is Shane Rourke, sitting in for Josh this morning. Thanks for taking my call.

Just back on the reputation issue real quick. You sound like you have got some stuff coming this spring, as far as response. I'm just curious -- are there any metrics or commentary as to where you know you stand right now? And any progress you've made to, say, compared to a year ago, how things are going?

The one thing I can share with you -- I can't share the metrics, but I will say this: It's very clear in our research that a portion of the population greatly believes in us. And then another portion wants to know our side of the story. And then there is some section of people that have been in place for some time, not just newly arrived, that, no matter what you say to them, they will probably never change their minds about the kind of activities we have.

So we are focusing on the people who may be wondering about SeaWorld. And we have a very clear message strategy to them, and a very clear spend strategy. And a very good media strategy. Not for a month, and not for two months, but we continue it, because the recognition of this Company, that this is an issue that has been with us a very long time. You can go back to Free Willy days. I know that this issue has been with us, and while it's been accelerated recently, we are well aware of who we have to go after. We understand the demographics and geographies involved. And we are very focused on it, with the right messages.

And it's important to understand that this is not something you just start slapping against. It is precise, it is targeted properly, and it needs to be frequent, and it needs to resonate, and it needs to be measured as we go along. We feel we have a good baseline. We know who to go after, we know how to go after them, and that is a plan that will be very apparent in the coming months. But this is not something -- this is not a hit and run, as we say in the marketing world, where you can just advertise for a month and hope it goes away.

This is a changing mindset and making certain mindsets stay changed, recognizing that the opposition is not going to stand still as we do this. So we have a much more, I think facile and knowledgeable program to go after this, with what we believe are some of the best people in the country working with us.

Okay great, thank you very much.

Thank you.

Thank you. At this time, I will turn the floor back to Gene Ballesteros for closing comments.

Thanks to everyone for your questions and for your continued interest in our Company. We look forward to updating you further, and speaking with you again next quarter. Thanks again for your time. That now concludes our call.

Thank you. You may disconnect your lines at this time, and thank you for your participation.