Thank you. I just want to go over three things that happened in the quarter or are related to things that I talked about last quarter to kind of update you on.

The number one for that is that we refinanced a loan at Aggieland, and that's in an 8-K that was released during the quarter, and then also in the 10-Q. For the details on that, you should go and see the exact numbers.

They are in our disclosures there in the 10-Q and in the 8-K that we had. The main points on that, though, is that it's a 7-year term and a 25-year amortization, meaning it pays down like it's a 25-year loan, but then it's due in full at the end of 7 years.

It's fixed, as opposed to it was floating before. It's fixed at just under 7%.

You can see that we entered into a agreement to convert the rate there to a fixed rate. Then you can also see that there's a covenant on that both in terms of debt service for the borrower, which is Aggieland Parks, Inc., that's the Texas subsidiary, and then you can also see that there's also a covenant for the parent company.

If you do the math on that, you can see that what debt service is, and then you'd multiply that by 1.2. The exact numbers are there in the 10-Q.

Basically, it means that the payments will tend to be lower in the future, actually, there's a debt schedule that you can see already on that to give you some idea. The loan amount is the same, which I wanted to stress.

There was no cash back on that or anything like that. It's just a refinancing to a longer term paying down slower.

The other two points were, I had mentioned insurance because someone had asked about inflation the last quarter. I had said that if we didn't make changes to the program, it was likely that I thought our insurance costs would rise about 5% for next fiscal year.

Most of our insurance policies renewed effective as of August 1st, it's already happened. It was after the end of the quarter, but it's happened now.

Actually, it'll be down about 8%, and that's because of changes to the program. Had that not been the case, it probably would have been up about 5% or something.

You should see slightly lower insurance costs in the next fiscal year, even though I said slightly higher was more likely. Then the last point is cost of goods sold, because there've been questions about inflation the last quarter.

While we're not generally seeing inflation pressures, and I would say that they are lower now than they were in the past, especially in things like increases of weekly earnings, so, yeah, payroll has been declining in line with kind of the overall economy, and so I don't think we'll see as much pressure on that in next fiscal year as we have this year or in previous years. The one thing that we have seen it on, and it's only been since the start of the Iran war, is animal feed.

Animal feed's a very substantial part of our cost of goods sold, especially at Georgia. Actually, the entire increase that you have on a consolidated basis for that you can see is really all due to increases in animal food.

It says animal food, merchandise, and food, but it's animal food, and those prices are highly commodity-based. They're kind of similar to fertilizer prices and things like that, that you're probably familiar with those things going up just since the war started a few months ago.

It's a very sharp increase in a short period of time. I don't know that that will be sustained long-term, but that's why you see that number going up so much.

Hay prices, nothing's happened on that, and that's the other kind of feed that we have. This is the feed that guests feed animals, and then also we feed animals with, not for guests.

These are the pellets that you see in the park, and that's a commodity cost increase, and that really explains all of the increase that you saw in cost of goods sold for the quarter, which you can see is mainly Georgia. There was a very significant increase.

It's a 40% increase or something, and that's not due to higher volume. That's due to just higher prices.

You shouldn't expect that you'll be seeing 40% year-over-year increases all the time in the future, but right now, commodity prices have jumped by 20%, 40% for some sorts of things like this. That kind of explains that.

Those were my only three for comparisons with questions from last quarter that there've been any developments on. That's it for me.

Sure. The Texas park, when I came in as president of the company, I was briefly the general manager of Texas as well while we looked for another general manager.

We found another general manager about a year ago, a year ago at the start of this past quarter that we're reporting, well over a year now. What you're seeing is we're now getting to a point where it's been about a year.

You won't see comparisons anymore after this quarter for where we were open seven days a week last year and only five this year. That change was made by the new GM coming in.

You've seen expenses being cut by this GM. In fact, I think for the quarter, every line that we breakout actually was down in Texas in terms of expenses, even though the segment income was down as well.

That was entirely due to a decline in revenue, right? That all sorts of expenses have been cut.

Part of the reason for doing that, or part of the way that was accomplished is by reducing the number of operating days. Our most comparable public companies are not in our animal attraction industry so much.

There's one that kind of is, United Parks, PRKS. Then other comparables we have are like Six Flags, and Dave & Buster's to some extent.

Those kinds of companies do sometimes breakout things about operating days. We don't.

Our parks are generally open every day except Thanksgiving and Christmas, but sometimes we have days where we're not open, for whatever reason. We don't really update that and tell you that we had fewer or more operating days.

We don't adjust things for that. We have no plans to do that.

I will tell you that, in general, at Aggieland, about 15%, 1 5%, of attendance is on the combined days of Tuesday and Wednesday, which are the days that were closed. That would be true at our other parks too.

Their Tuesday and Wednesday attendance combined is usually 15%. About 85% of your attendance in the industry is normally on the five days that aren't Tuesdays and Wednesdays.

The reason why you don't close on Mondays is that sometimes holidays are on Monday, it complicates the schedule more. Tuesdays and Wednesdays are middle of the week and not common for holidays.

I don't know if it'll be something that's done permanently. You've obviously seen that attendance has been down a lot in Texas as compared to the other parks, and even revenue was down this quarter, despite the fact that there's higher prices.

The complication from not being open on certain days is an issue for marketing and customer acquisition costs, right? Because even though you might only get 15% on those days, there is an advantage to people being able to come at any time, they can just show up and it's never closed.

They don't have to worry about that. There is some complication to doing that, and there's a good reason why many parks in the industry and why we historically have been open seven days even though it's generally hard to justify a good economic return on, say, Tuesdays and Wednesdays combined throughout the year.

It was an effort to make a lot more profit at Texas without necessarily having to increase attendance, right? That decision was made mainly because of the condition that Texas was in a few years ago, which you saw, I think last year was the first EBITDA-positive year, and then this year was significantly higher EBITDA than last year.

Lately the park has been operating at levels of attendance, and sometimes even sales, that are in line with not last year, but the levels that they were at 2, 3, 4 years ago on average. It's returned, in a lot of ways, to what that was, and yet it is reporting profitability in quarters where it did not historically.

The reason for that is many things: cutting payroll, cutting different expenses in the park, increasing prices, but also not those two days being open. It's trying to get a much lower cost structure, much lower expense structure.

There is also an advantage, and this is why you can cut payroll, there's an advantage because if you're open seven days a week, there's a minimum level of staffing that you have to have, and so there isn't as easy to schedule people to do office work and everything, managers, if they are doing work with guests, let's say, and if they're open seven days a week, they're more likely to have to do that, right? The least busy days allows a lot of things to be done that aren't guest-facing things on the other days, which allows not having to schedule as many hours and things like that.

That's the logic behind it. It makes a lot of sense that way.

I don't know that it offsets the possible marketing problems that it causes by added complexity. In theory, for a lot of parks, it would probably be more profitable to operate five days a week instead of seven.

In practice, I'm not sure if it's a big difference. Obviously, we would show lower attendance.

No doubt about that, because all the people who come on Tuesdays and Wednesdays won't definitely shift. Some of them won't shift.

It will lower your attendance and your sales to some extent, though I don't know if it really has a huge effect on your profitability. I can't tell you if it's a permanent change.

We're looking at it and saying, okay, we can see the expense reductions that there were from it. On the other hand, although we had higher attendance in general initially even when we were only doing five days instead of seven, we were doing more people on those five days.

That's not the case now a year later. You can see that.

It may be that it doesn't make sense to do it, and so we'll definitely always be reevaluating that. Whether those are the best days, whether you should do five instead of seven, it's something that we think about.

I don't know if it's completely permanent, but there are no immediate plans to change it.

I actually would say, in terms of margins and looking at the entire year now, margins are not really the problem. I know that our margins are down this year versus last year for the same quarter, and a large part of that is the heavy blending in of the size effect of Georgia, right?

Even if Georgia is only down 500 basis points or something, that's super significant, cuz it's a bigger part of the overall mix of all three parks, right? You have margins at Texas even in a bad quarter for them, in terms of the biggest attendance declines that they've ever seen, really, where they still did 34%, 35% EBITDA margins.

Obviously, seasonally it's a good time of year for them. Even at earlier parts of the year, the margin is fine that way.

I don't know that we would be pushing for much higher margins. What I would say, though, is that our real target is EBITDA divided by the assets invested in the business, really.

Basically a measure of return on invested capital in a cash flow basis. That is an issue at Texas, in that the sales level, right, is very low versus the amount of assets that it has.

It's really the sales turnover, sales divided by assets, that's the big issue. Certainly, the park could be profitable and successful with these margins if it had higher sales and higher expenses, but not higher assets.

It's obvious from the perspective of, say, Texas or something, that large increases in sales, even if they also had fairly large increases in expenses, so that dollar-for-dollar we were making more dollars, but we weren't necessarily making much higher margins, would be fine. A park that's doing what Texas, for instance, is doing throughout the year in terms of margins is actually fine for the industry, for a well-performing park.

What is not fine is the sales level versus the amount of assets. That's really low, and so that is a problem.

I think our goals are always on the side of the return on the capital, and so it's both a matter of how much capital is invested in it and what the sales level needs to be to justify that, and not purely on a margin basis. I know that we break out the margins, talk a lot about the margins, and that's the thing that you see fluctuating year to year, but these are all now pretty high-margin businesses, at least in their stronger part of their season.

I don't know that you need to get your margins from, say, 30% to 50% or something. A good quarter for a great park like Georgia or something might be 50%, and a not-so-good quarter for a park that isn't doing as well might be 30%.

I don't think that it's just about getting the margins up that way. I think it is really the level of sales and stuff.

You can see, for instance, that Georgia has much higher expenses, but it also has over three times the sales that Texas had this quarter, right? It's that kind of thing, is needing to get sales up, but not necessarily needing to squeeze margins any tighter on that.

Having said that, I do think we are getting closer to where we want to be, in terms of operating costs that aren't So not cost of goods sold, but the other parts of it. Our corporate costs are getting to where we want them to be, and I think that certain other things that we break out as other segment expenses, things like that at the parks, are also good on those things.

I talked about insurance. Insurance as a percent of revenue should be down this year.

It was down each of the past two years, because insurance costs are down a little bit in dollar terms, and then if revenue is a little bit higher, that gets better over time. I do think that some of those costs are in line with what we need them to be.

I don't have problems on that. The two categories which are an issue are costs of goods sold, which we talked about, and that was a commodity increase this time, and eventually, we may have to have price increases at times on things like animal feed and on tickets even, or other things like that eventually, if you have a lot of pressure on that.

I think that it's not necessarily super short-term, but it is something that you're adjusting to all the time. If the overall price level adjusts, then we do have to adjust our prices, but that happens throughout the economy, and it's just a lagged effect, and I'm not too worried about that.

The much bigger one is the advertising and marketing, which you saw we did cut during the quarter, but I did not cut it fast enough. We had really bad results, like I said, start from basically March, and so we saw that, and I did not slash those down dramatically at the beginning of the quarter or something.

Only part of that is what you're seeing in the quarter. That is definitely the area where we have the most problem.

Return on ad spend is by far the most important thing for driving the kinds of results that we want, but I can't guarantee that that would be higher margins as much as what we're going for is higher returns on capital.

The only new business initiatives, really, are, if we define that broadly, is we do have a bunch of things changing with marketing. We have someone at Missouri who does work for the overall company, but also does work directly at the park there.

Then we have two employees added actually just recently. One in Georgia and one at Aggieland that only do work at that one place, which are social media coordinators, basically.

That's why we can do TikTok now. That's also though that they can do things at the parks in terms of we just have more information at the parks about events, annual passes, additional things that we do by producing material internally, and then putting it out on flyers and things in the parks brochures.

That's started. Then from that, we have much more investment in organic social media, some investment in influencers to some extent, too, and user-generated content, kind of encouraging that stuff.

Most of those initiatives with marketing things are going to happen in the next few months, and then you won't really see a lot of the benefit from that, probably, until the start of the next season, because the biggest changes will happen during the offseason. The changes that are likely to happen, and some of these, I should say, I can't tell you the exact time they'll happen cuz they have elements to them that might be slower than I think or something.

The biggest one that could be slower than I think is digital signage. There'll be digital screens added at all the parks.

We've already started work on that, but that does involve actually physically putting things in, and electrical work and stuff like that. I don't know exactly when that will happen, but it'll be probably around the fall of this year, and then you would have those up pretty quickly, cuz they're already doing work on what content would be up on them throughout the parks.

That'll be centrally controlled by corporate marketing employees, who can change the screens at each of the parks and everything. Redo of website things, which we're in the process of doing, but, again, I don't know exactly when that'll be, but probably a couple months.

That might be a little bit faster, cuz it doesn't involve actual work at the parks. Then you have new billboard campaigns, and you also have a new social media, online, a new ad agency, meaning covering Meta, primarily Meta and Google, honestly, is our biggest advertising online.

Paid ads that we do. Change in that as well.

All those things should happen, I would say, by around November, I would expect that we'd have that in place. Then some of it has been more fast-tracked, I guess, in terms of Aggieland.

I would say that there's already efforts going on with that stuff right now that should be in place in, say, the September to October period in Aggieland. The reason for that is we're doing a promotional campaign in terms of pricing built around the football season there.

We're not doing what we did a couple years ago, where we had days where there was actually free admission, but we are doing something for home game weekends. There's about, I think that's seven days, and I think we're also doing Halloween, it might be eight days total that we're doing, which We want to have some of these things in place already to do that first.

That would be the first trial run. It'll be maybe 60 days faster, like covering the September to October period in Aggieland, and then all the things that we are changing up at Aggieland will also be changed about the other parks, which, like I said, is mainly billboard campaigns, websites, digital screens, and then we do have social media coordinators in there and that's already doing some stuff in terms of more investment in social media.

I would say we'll see either that there's strong results from this new agency, which is a specialist in attractions similar to ours, of doing this kind of marketing. If we don't have good results from this, I think we'll definitely have a big change in terms of probably not doing a lot of paid advertising online at all after this year.

We'll either have much better return on ad spend this year from paid advertising online, or we will stop doing it. The reason for that is that's by far the highest area of our spend and has the weakest results, and is the thing that we do the most externally.

It's very hard to manage that level of ad stuff internally at a company our size. Things like billboards and stuff, we pick the billboards and negotiate and do all the creative and all that stuff internally.

Something like these ads have a much higher aspect of both an outside agency doing it and then also they just tend to have a poor return on ad spend. That's been the case since I've been here, and it was the case before then.

It's actually gotten better each year, but it's not good. That would be the biggest change, I think, and the thing most likely to cause a big change in our results is if we can get higher attendance and sales with the same level of advertising spend or have lower advertising spend and the same level of sales that way, because you can see advertising and marketing, which is just actual ad spend there, that's advertising and marketing really is not including internal things that we do.

That's basically what we pay an agency, and then what we pay for actual ads, media buys and things like that. That you can see is a huge part of our overall spend.

We were talking about margins, and certainly we would have been better off this past quarter, for instance, if we basically didn't have that spend, or at least we didn't have the digital part of that spend. The billboards are pretty effective, but the billboards are a smaller part of it overall.

The majority, I can tell you, of that number that you see for advertising and marketing, more than half of it has generally been Meta, Facebook and Instagram, and to some extent Google. It is lowest return on ad spend of what we do.

That would have the biggest effect on margins, and that's most of what the business initiatives are focused on, is these changes. They're all tied together that way, and that we would like to have redesign of website things at the same time we switch over agencies for all sorts of data reasons and stuff.

At the same time that we're launching new campaigns and things. Like I said, our season is kind of pretty much over around Labor Day.

These things will start up at Aggieland first, and then we're not talking about really until November that they start up at the other parks. I think I'll see initial differences right away, but I doubt there'll be a lot for me to report to you that will matter a lot in dollar terms, because those are extremely slow months for us: November, December, January, even February.

I don't think you're going to see really big results from that that I can talk to you about in dollar terms until March.

We don't have a plan to pay down debt rapidly or anything, but it is true that our cash will build up because the paydown of the debt now is going to obviously be slower than we'll be generating cash from that. I know that our debt-to-equity ratio has technically dropped a little bit, but that kind of number won't drop a lot so much as you'll see higher current assets versus lower current liabilities more often.

A higher current ratio, have a greater liquidity, rather than lower leverage overall. If you're generating enough EBITDA and everything, that it's appropriate to have some debt.

I don't think it's a question of us doing something just because they don't have a lot of debt or that we have a lot of cash on hand. That wouldn't really be why we make the decision.

You see that our cost for debt recently have been around 7% fixed. That's pretax, and so after-tax that's lower, obviously, and so we compare that to things like buying back the stock or something.

At the moment, we have bought back stock at around this price. You can judge from that that we believe that if you take the after-tax cost of the debt at 7%, we think it's a better investment to buy back the stock than say pay down the debt at that level, okay?

That doesn't say a lot about things that drive a lot of shareholder value or something. It just means that it's because of that that cost is not incredibly high, it's not something that we would pay down debt instead of buying back the stock unless the stock was very expensive.

In terms of the low float, that's true. We did switch transfer agents, and that was in preparation for improving things around a bunch of things having to do with increasing trading activity in the stock potentially for people, just ease of being able to do that, mainly by getting things over from physical things into digital formats and stuff.

On that, also executing some stock buyback things, right? That's absolutely true that the float is a much lower percentage of our overall market cap than is at most companies, and then many holders are longer-term holders.

It's larger transactions when we get something. It's someone wanting to sell half a percent of the entire company to us or something is the kind of transaction we normally see.

It's more that than we don't go out in the market and buy, for instance. That will continue to be the case, even though I think it'll be better with this new transfer agent, and we'll work on that to improve those things.

The buyback shouldn't drop down to nothing. We'll still have that authorization.

We should still carry out buybacks from time to time, and are still interested in shareholders who are interested in selling meaningful amounts to the company, as long as the price is right. In terms of capital allocation, we have been approached sometimes by possible sellers of parks, of animal attractions, essentially.

We've looked at those, and I would say, prior to the beginning of this calendar year, let's say, the last seven, eight months or something, we never had situations where I would say the price and just basic initial things was enough to really interest us in looking into it deeper. Since January, there have been a couple, maybe literally two cases where, okay, it made sense on paper.

Then it's just a question of, all right, is management going to stay on or not, is there other management that you can get, what's the structure of financing the deal, what is the overall sorts of things about the qualities of the business and things like that. It made sense in a dollars and cents way.

We had not talked with anyone before the beginning of this year where I would say it even made sense in the initial approach just on paper, right? These did.

It's a question of due diligence and working that out, and do we really want to do a deal in terms of the asset, and the people involved, and all that kind of stuff. Before this year, I'd say there was not even things coming to us that we were interested in, just from a pure point of how much EBITDA they had and what kind of price they want and stuff.

We could just say immediately, no, we're not really going to interested in looking at this. That's not been the case, so, this year.

That is different. I don't know why that is, exactly, it's a very small sample size, it could be pure luck.

It could be something in the economy and whatever, just enough time has passed since COVID when these kinds of businesses were really flush with generating a lot of cash and people just looking at possibly selling, or it could be, very possibly just higher interest rates and things, meaning that there's interesting deal possibilities. That has been the case.

There have been interesting possibilities in this year, and there weren't before. That's the only other thing that I would add.

That is significant because there's sort of a minimum size of what would probably make a lot of sense. If you look at the cash that we have on our balance sheet, it isn't necessarily a lot more than the kind of deal we would like to do.

Although it might look to shareholders like we have excess cash and everything. That may be true if you don't do acquisitions at all, but one acquisition means you have no excess cash, you know what I mean?

That's the kind of deals that we would be looking at. It would be kinds of things where the question between a yes or no would be the difference between we've got cash and what do we do with it, and we don't have a need for anything other than this deal.

That's a clear way of using the cash that would use up basically all of what we would consider the cash we have available to use. It really is the difference there is really just a size of one deal.

I do think that we do look at that, and we have seen more potential that way. It just can't be done at a dribble.

We can buy back stock in a small way every quarter and not have a big effect on the cash, but we either do a deal or don't, and it'll be several million dollars if we do one, you know? I think that's what you're going to see, and so I wouldn't expect some big change in terms of us trying to finely adjust the cash position all the time.

I think just if we don't do any deal for a while, you'll see a bunch of cash there, and if we do, then you won't see that cash there. That's just the difference between it.

We're not going to really focus on fine-tuning it from quarter to quarter or something. It's not kind of trying to be that efficient about it.

We would be happy to hold a one deal sized amount of cash on the balance sheet. I think that would be appropriate.

No, I think that's it for me.