Q3 2024 Lindblad Expeditions Holdings Inc Earnings Call
Yeah. So you may begin.
Speaker Change: Thank you my deep appreciate it good morning, everyone and thank you for joining us for the Limbo adds 2024 third quarter earnings call with me on the call today is spend lindblad, our founder and CEO Ben.
Speaker Change: I will begin with some opening comments and I'll follow with some details on the financial results and current 2024 expectations before we open the call for Q&A.
Speaker Change: You can find our latest earnings release in the Investor Relations section of our website.
Before we get started let me remind everyone that the company's comments today may include forward looking statements those expectations are subject to risks and uncertainties that may cause actual results and performance to be materially different from these expectations.
The company cannot guarantee the accuracy of any forecast or estimates and we undertake no obligation to update any such forward looking statements.
If you'd like more information on the risks involved in forward looking statements. Please see our SEC filings.
Speaker Change: In addition, our comments may reference non-GAAP financial measures a reconciliation to the most directly comparable GAAP financial measures and other associated disclosures are contained in the company's earnings release.
Speaker Change: That all the way let me please turn the call over to Sven.
Sven: Thank you guys and good morning, everyone. We appreciate your joining us today on election day.
Sven: Our record third quarter results set the stage for another year of double digit growth in 2024.
Speaker Change: He will provide additional color on our financial performance this past quarter, but before he does let me take a few minutes to discuss some of the drivers of the continued growth this year as well as the steps we are taking to sustain that momentum in the years ahead.
Speaker Change: Let's start with the Lindbergh business segment.
Speaker Change: I'm excited to report the bookings to date for future travel and our Lindblad segment increased 26% versus the same period of 2023.
Speaker Change: During the quarter all of our 22026 inventory was released for sale and we also are selling inventory for our own fleet through Q1 of 2027.
Speaker Change: The key metric occupancy is on a positive trajectory, particularly when paired with yield.
Speaker Change: Available guest nights increased by 7% and occupancy rose from 81% to 82%.
Speaker Change: Maintaining price integrity with an increase of 9% and net yield per available guest night compared to 2023.
Speaker Change: We continue to see significant discounting from competitors. However, we are able to manage through the noise in the market this quarter.
Speaker Change: Interestingly the third word for building new expedition ships seems to have abated.
Speaker Change: We remain focused as an organization on returning as quickly as possible to our historic Occupancies and based on our current booking trends. We feel confident we are on a path to do exactly that.
Speaker Change: At the same time, we have stayed committed to price integrity, which is fundamental to our business model.
Speaker Change: To reliably returned to the occupancy levels. We historically have enjoyed building back our past guests base. This customer cohort is the backbone for a segment of our itineraries those that are longer and more esoteric.
Speaker Change: We believe this strategy will result in us achieving this goal for the full year in 2026.
Speaker Change: A key focus of our team is our agreement.
Speaker Change: Key focus for our team as our agreement with National geographic and Disney to build and significantly grow the company through at least 2040.
Speaker Change: This long term agreement is not yet a year old and we are in the beginning stages of capitalizing on its full potential.
Speaker Change: As a reminder, the rallying cry within the three organizations that have chosen to deeply collaborate lindblad national geographic and Disney is the power of three.
Speaker Change: On the surface the key ingredients each brings us lindblad expedition execution National geographic brand strengths and Disney distribution.
Speaker Change: I am pleased to report that we have made real progress on each of these focus areas since our last earnings call.
Speaker Change: In September we do.
Speaker Change: First our refreshed co branded identity National geographic Lindblad expeditions with the launch of our new co branded identity. We made the strategic decision to lead with power and name recognition of National geographic bolstered by Lindblad expeditions Rich heritage.
Speaker Change: Pioneers of modern expedition cruising.
Speaker Change: The power of this new co brand and improve name recognition will be vitally important as we expand our footprint in key growth markets around the world.
Speaker Change: We believe that this updated co brand will drive consumer intent search efficiency and conversation, bringing more discerning travellers onboard our growing fleet.
Speaker Change: The new National Geographic Lindblad expeditions co branded identity and logo will be fully implemented across all marketing channels by the end of the year and.
Speaker Change: Early 2025, the co brand will debut the sweeping omnichannel consumer and trade marketing campaign, the largest in our history.
Speaker Change: Powered in part by the reach of the Walt Disney Company.
Speaker Change: As part of this effort Disney led the ideation production direction and funded a major commercial shoot in the Galapagos, which we featured in the new multimillion dollar AD campaign being launched by Disney in the new year.
Speaker Change: Finally, the implementation implementation of new branding across Lindbergh expedite expeditions growing fleet of 20 owned leased and chartered vessels has begun and will continue through 2025.
Speaker Change: We also announced the inclusion of our trips in the Disney travel advisor loyalty program called earmarked.
Speaker Change: Coincidentally with the launch Disney invited me to key note the Disney destinations Earmark program owners annual summit in October I had the incredible opportunities to interact with hundreds of thousands of travel agencies and the earmark program and we are already seeing interest in bookings from some of these <unk>.
Speaker Change: So now on the benefits agents received for booking Disney products will be offered with booking ours as well.
Speaker Change: As we approach 2025, we have plans to ramp up marketing to Disney affinity audience, including Disney Visa Cardholders D 23 clubs 33, Disney cruise line's Disney vacation club and Disney Cashman.
Speaker Change: Now that we're able to market and sell with the AMG brand internationally, we've been ramping up our international sales effort with our launch in Great Britain in Q3, and we are developing additional sales relationships and several other countries in Europe and Asia we.
Speaker Change: We expect to see several million dollars of sales to customers in Great Britain and Europe. This year with those numbers increasing significantly in 2025 and beyond.
Speaker Change: We are also working very closely with the National Geographic Society to enhance the connection of travelers to the society itself. A couple of very specific scalpels, where we see growth opportunities taking full advantage of the branding power first is the acceleration of family program.
Speaker Change: After all that's Disney Sweet spot and we collectively intend to take full advantage next we also continue to look at a variety of new charter products that we believe will be uniquely successful under the new program, including possible expansion of river cruising.
Speaker Change: So we believe that through committed and very testing and campaigns, we will be able to generate meaningful growth as a consequence of our alliance beginning next year.
Speaker Change: A few words about product in inventory, we recognized last year that we needed to rebalance our inventory.
Speaker Change: Order to have more sailings that would attract new first time travelers. This is the first quarter, where this rebalancing balancing has really taken effect with particular focus on having increased and changed our approach to Iceland, which is a popular destination for us to attract first time traveling.
Speaker Change: We formerly announced start to shift the expansion in the Galapagos for 2024, and the response has exceeded our expectations. The variety of both platforms with four ships and itineraries are four of $5 seven nights in the islands combined with a variety of add ons in Ecuador, and Peru create promote.
Speaker Change: Diverse offerings of any company in the region sailings will begin in mid February for the 16 guests National Geographic Delfina and mid March for the National Geographic Gemini.
Speaker Change: Later this month from joining our team to convene a select group of journalists and Influencers to go to add to our 2000 the inaugural of our new <unk> programs that offer either one way flights are both ways from Chile to King George Island in Antarctica, allowing people with less time to fully enjoy Antarctica.
Speaker Change: Eliminating either one or both crossings of the Drake passage.
Speaker Change: These itineraries have been well received them for the next season, we are adding a second shift dedicated to these itineraries.
Speaker Change: Now, let's turn to an update on our land experiences segment, which continues to thrive and grow.
Speaker Change: Revenue last quarter was $84 7 million or 26% increase year over year.
Speaker Change: Im excited to report the bookings to date for future travel and our land experienced in segment increased 20% versus the same period in 2023.
Speaker Change: The strategy of acquiring best in class land based expedition travel companies that are mission aligns extremely well run and they can benefit from carrying part of our organization has proven to be of great significance for value creation.
Speaker Change: At the end of July we completed the acquisition of our first land company Thompson Safaris.
Speaker Change: Has been focused on the spectacular country of Tanzania for over 40 years and their operation will create synergies with natural habitats East African operation.
Speaker Change: Integration with National Natural habitat is progressing smoothly and we are investing in sales and marketing resources to continue to grow the Thompson brand.
Speaker Change: Each of our land companies is pursuing their stated mission with vigor.
Speaker Change: And to be a dominant force in their focus segments.
Speaker Change: Our thoroughly committed to continuing this strategy of signing compatible companies and extend both diversity and scale in the land segment and fully take advantage of the fact that our travelers are numerous and their interest in keeping that interest in the family. So to speak is a salad and accretive approach.
Speaker Change: In summation, a very good quarter, and one which has seen record growth in future bookings tangible product on our progress for our new brand.
Speaker Change: And building out the collective power of National Geographic Disney and Lindblad.
Speaker Change: Tyson will now delve deeply into the numbers.
Tyson: Thank you Sven.
Tyson: Lindblad strong year on year growth continued during the third quarter. We are pleased to report both record revenue and earnings growth as well as record level of bookings for future travel as we deliver sustained year on year growth. We continue to take the operational and strategic taps necessary to take full advantage of the earnings potential of that.
Speaker Change: Of the company.
Speaker Change: Turning to the third quarter total revenue of $206 million increased $30 million or 17% versus the third quarter of 2023.
Speaker Change: Lindblad segment tour revenue was $121 3 million, which is an increase of $12 5 million or 12% compared to the third quarter a year ago increase was driven by a 6% increase in available guest nights, 9% increase in net yield per available guest night to 12, Oh, five and a 1% increase.
Speaker Change: In occupancy to 82%.
Speaker Change: Bland experiences tour revenues were $84 7 million, which is an increase of $17 5 million or 26% compared to the third quarter a year ago led by additional guests and higher pricing.
Speaker Change: <unk> mentioned on July 31, we also closed the acquisition of Wineland Thompson Adventures and adventure travel group that primarily operates African safaris.
Speaker Change: <unk> also contributed to the quarter's strong growth.
Speaker Change: As a reminder, the aggregate purchase price of $30 million and we financed the purchase through 24 million of cash on hand, and the issuance of $6 million in common stock.
Speaker Change: Third quarter, adjusted EBITDA was $45 8 million and increased 35% year over year, driven by a 30% increase at the Lindblad segment and a 42% increase at the land experiences segment.
Speaker Change: Lindblad segment, adjusted EBITDA of $26 2 million increased $6 1 million as compared to the same period in 2023, primarily due to increased tour revenues.
Speaker Change: Partially offset by increased marketing spend to drive long term growth initiatives higher general and administrative costs, primarily due to increased personnel costs and increased royalties associated with the expanded national geographic agreement.
Speaker Change: <unk> segment, adjusted EBITDA of $19 6 million increased $5 7 million as compared to the same period in 2023 due to increased tour revenues and the addition of the Wildland Thompson Adventures partially offsetting.
Speaker Change: Being offset by increased operating and personnel costs higher marketing spend to drive future growth and credit card fees and commission expense.
Speaker Change: Looking closer at the cost side of the business operating expenses before depreciation and amortization interest and taxes increased $18 8 million or 13% versus the quarter a year ago.
Speaker Change: Cost of tours increased by $8 9 million or nine 3%.
Speaker Change: Sales and marketing costs increased by $5 6 million or 29% versus a year ago again, primarily due to the increased royalties associated with the expanded national geographic agreement and initial marketing spend to drive future bookings.
Speaker Change: Fuel costs were stable at four 5% of revenue in the third quarter, which was down about a half a percent compared to the third quarter a year ago.
Speaker Change: General and administrative costs, excluding stock based compensation and transaction related costs increased $3 6 million or 13, 5% versus a year ago, primarily due to increased payroll costs as well as credit card commissions associated with continued bookings growth.
Speaker Change: As we highlighted last quarter, we remain focused on improving efficiency throughout the organization, we've identified areas for continuous improvement of existing processes and systems, which we believe will further improve operational efficiency and reduce certain costs are.
Speaker Change: Our north Star is to achieve these objectives, while maintaining our where possible improving our guest experience.
Speaker Change: Turning to the balance sheet, our liquidity position remained strong total cash was $224 6 million as of September 32024, as compared with $187 3 million as of December 31, 2023.
Speaker Change: This increase reflects $90 7 million in cash from operations due primarily to increased bookings for future travel.
Speaker Change: We used $34 4 million of cash for investing activities year to date, including $10 7 million used in the Weiland Thompson ventures acquisition net of the cash acquired as well as $23 6 million for the purchase of property equipment.
Speaker Change: Closing of our previously announced purchase of two purpose built Galapagos expedition vehicles is on track for 2025.
Speaker Change: <unk> highlighted have already begun adding additional bookings for the national geographic Gemini and the National geographic Delfina ships. So effectively use the time, we have between signing and closing.
Speaker Change: Upon closing the ships will undergo revitalization before embarking on air and all of our wages in late first quarter 2025.
Speaker Change: Consistent with our stated strategy, we will continue to explore growth opportunities in the years ahead.
Speaker Change: <unk> further diversifying our product portfolio, we're opportunistically expanding our fleet to capitalize on the continued growth and the demand for experiential travel.
Speaker Change: Turning to the full year 2024, we continue to anticipate significant growth driven by higher guest counts and increase that yields across the fleet as well as additional travelers across the growing land business.
Speaker Change: We continue to expect tour revenue in 2024 between 610 and $630 million and adjusted EBITDA between $88 million to $98 million.
Speaker Change: The acquisition of Thompson as far as expected have a minimal contribution this year due to certain planned investments in the business. However is expected to be a more meaningful contributor for the full year 2025.
Speaker Change: Overall, we're very pleased with the operating momentum across our business. Thank you for your interest and now spend and I would be happy to answer any questions you may have.
Speaker Change: Thank you we will now begin the question and answer session.
Speaker Change: And we'd like to ask a question. Please press star one on your telephone keypad raise your hand and joined the queue.
Speaker Change: I would like to withdraw your question simply press Star one again.
Speaker Change: If you are called upon to ask a question or listening via loud speaker on your device. Please pick up your handset and ensure that your phone is not on mute when asking your question.
Speaker Change: Again press Star one.
Speaker Change: To join the queue.
Speaker Change: Our first question comes from the line of Steve.
Speaker Change: We send ski with Stifel. Please go ahead.
Steve: Hey, guys good morning.
Steve Wesenski: So you talked about using your your past guest base in order to drive occupancy back to.
Steve: To historical levels.
Speaker Change: Did I hear you right that you expect to be back to that level by 2026.
Speaker Change: There might be some benefit from from Disney moving forward, but look if my math is right and you would you would get you guys will get back to that kind of let's call. It upper <unk> low <unk> in terms of occupancy.
Speaker Change: And look you've talked about every occupancy point is about $4 million plus in EBITDA.
Speaker Change: Just with occupancy that would kind of get you guys back into that mid 120 is call. It in terms of EBITDA.
Speaker Change: By 2026, and that's going to be without any pricing action or benefit from your your land based operation. So that's kind of a way of me asking if you from a high level of agree kind of with that math as we think about.
Speaker Change: The EBITDA progression and where this company can really go moving forward.
Speaker Change: Yeah. So.
Speaker Change: Just answer the first part of the question.
Speaker Change: And just to reiterate for anyone else who is listening.
Speaker Change: The way alright generators are constructed and the kinds of shifts that we have there.
Speaker Change: You are going to be in areas.
Speaker Change: With certain shifts at certain times.
Steve: Are particularly dependent on people, who traveled with you before.
Steve: And having lost basically two years of our community.
Steve: We were set back.
Steve: And that has been rebuilt and by 2026, it will be completely back to.
Speaker Change: A level, which is appropriate for the balancing of our inventory and sold to then get to the numbers Youre talking about Tyson you may want to clarify in greater detail, but that sounds about right.
Steve: Yeah, I think Steve.
Steve Wesenski: Greatest speak with you.
Speaker Change: We're not giving long term guidance on the call our 2025 guidance yet.
Speaker Change: But I think Directionally speaking the earnings power of the business will increase significantly and I think you saw a lot of that even without the increased occupancy.
Steve Wesenski: A meaningful increase in occupancy this quarter, just how much operating leverage we saw in available guest nights and pricing increases so.
Steve Wesenski: We're excited about the future potential here.
Speaker Change: Okay, great. Thanks for that guys and then.
Speaker Change: Second question Dyson or spend whoever wants to take this I mean look you guys are now building a pretty healthy.
Speaker Change: <unk> cash position at this point and just wondering whats your.
Steve: Updated thoughts are in terms of free cash flow usage moving forward I would assume continuing to drive down your debt levels is it does remain a priority, but you made a comment.
Steve: How your peers don't seem to be building as much.
Steve: In the out years, so does that change your view of maybe starting to think about order ships again in order to to.
Steve: To capture longer term demand.
Speaker Change: Well there are two pathways right.
Steve: And remember how the company was originally built the company was originally built by purchasing ships that had failed in other enterprises.
Steve: Very very reasonable rates.
Steve: And so I would imagine within the future there is going to be again.
Steve: Inventory available I E ships available because certain companies rule will not have found that business successful and so we've done well.
Steve: Job is to look at the future from the perspective of building new or acquiring ships that have already been built.
Steve: Ken.
Steve: We've had a good deal of experience in both those lanes and so we're kind of excited about the opportunity to think.
Steve: About ships.
Steve: <unk> already been built.
Steve: Become available.
Speaker Change: Okay got you thanks, guys congrats on a very solid quarter.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of Eric Wold with B Riley. Please go ahead.
Eric Wold: Thanks, Good morning, Thanks, taking my questions.
Eric Wold: A couple of questions around kind of the numbers I guess, one can you give us an update on what percentage of your tool revenues have been booked.
Eric Wold: For this year I know you gave 98% on the last quarter call. So maybe an update to that and then.
Steve: Maybe talk about the decision to maintain 2020 for guidance.
Steve: If I look at it you're reaching the high end of the range at 630 would have the lowest growth rate.
Steve: Of any quarter this year, even with kind of strengthening bookings and the acquisition of the land segment is there any incremental headwinds you should think about.
Steve: For Q4 that maybe have come up and then.
Steve: Second part of that is what would need to happen to actually reach the low end at $610 million at this point in a year.
Speaker Change: Yes, no. Thank you for the questions.
Speaker Change: So let me hit a couple of points here I think the first just on seasonality.
Steve: As you know, but maybe for some that may be new to the company our quarterly results do fluctuate due to seasonality in the third quarter benefited from.
Steve: A more complete fleet usage in peak seasons across really our fleet and our land businesses.
Steve: And Conversely in the fourth quarter will be impacted by less available guest nights due to heavy drydock in transit time across the marine fleet and Theres more shoulder season inventory and seasonality across our land businesses. So.
Steve: There is a natural kind of ebb and flow to the results and I think that's that's.
Steve: That's an important factor.
Steve: To your question on.
Steve: On the guidance range and I'll talk about the booking position, we haven't seen anything significant that would change our revenue or EBITDA guidance.
Steve: I would note that kind of the wall Street analyst estimates have us on the lower end of the guidance I'm sure you've seen and we don't think that's inappropriate given we've had some voyage cancellations earlier in the year and we've continued to ramp sales and marketing investments, which we believe will benefit future years, and I think <unk>.
Steve: <unk> seen that given the record bookings position that we're in today.
Steve: We're currently sitting in our booking position that accounts for approximately 99% of full year projected revenue.
Steve: For 2024.
Steve: On the marine side and.
Steve: Any new revenue could be offset by cancellations, we are in a normal kind of cancellation environment.
Steve: But that can ebb and flow and it can be difficult to predict even in the last few months of the year. So we feel confident that we're in a good position here and.
Steve: And that's why we've reiterated the range but.
Steve: Between those factors.
Steve: That's why we haven't increased guidance at this point hopefully thats helpful.
Speaker Change: That's very helpful. And then just my last question.
Steve: Maybe.
Steve: David in terms of the meaningful increase in net yields in the quarter up eight five.
Steve: <unk> year over year.
Steve: Anything to call out is the major driver there I guess I know you talked about holding price to the competitive environment that actually reflect taking price where you can versus maybe how much of that was driven by mix.
Steve: Dispositions voyages.
Steve: So okay.
Steve: Okay.
Steve: But just because a part of that as we do.
Steve: This is really the first year, where we are beginning to.
Steve: CV effects of dynamic pricing. So for example, if you take an area like the Alaska.
Steve: Already now for <unk>.
Steve: Next year, we change prices.
Steve: Five or six times.
Steve: For this year I can't I can't remember exactly how many times with changes, but we were able to raise the price of the season went on and the demand showed the strength of insured so.
Steve: That is certainly part of the reason.
Steve: Jonathan.
Jonathan: Yes, I was going to say the same thing.
Steve: I think that's the dynamic pricing and really full implementation of our new technology systems I mean, we still.
Steve: The team refers to we have a Ferrari and I don't think were professional drivers yet, but we're getting pretty close and so that's a real benefit to the company and we think thats helping.
Steve: I wouldn't forecast.
Steve: Net yield growth going forward at that level, we've talked about the overall environment.
Steve: There is still a lot of discounting out there.
Steve: We're in a really good position, but going forward and we can talk more when we do guidance early next year, but I think there is a there's a good opportunity here to take more occupancy gains going forward.
Steve: So this I wouldn't extrapolate out sort of this this type of pricing.
Steve: Increases going forward necessarily but we do think we're in a good position relatively speaking.
Speaker Change: Perfect. Thank you Bob.
Speaker Change: Our next question comes from the line of Alex Fuhrman with Craig Hallum Capital Group. Please go ahead.
Alex Fuhrman: Hey, guys. Thanks for taking my question it sounds like Youre, starting to see some pretty strong demand from travelers in the U K and Europe I know historically your business has mostly been focused on American travelers curious where are those those British and European travelers are booking are they.
Alex Fuhrman: Mostly booking the Arctic and your European itineraries or are they venturing over to the western hemisphere as well.
Alex Fuhrman: Yes.
Alex Fuhrman: Terms of the year.
Speaker Change: The real beginnings of the European bookings are coming out in Great Britain, where we put in a particular effort to begin with signing a GSA.
Speaker Change: And.
Speaker Change: So it's very very early stages in terms of it's not.
Speaker Change: Not going to be as we said earlier very very much this year, but we believe it is going to increase dramatically next year and Theres a lot of testing going on at the moment to try and figure out which of those programs are most attractive and cost effective to market.
Speaker Change: But we have an enormous beliefs that the national geographic Brown. This is one of the key elements going forward.
Speaker Change: In terms of.
Alex Fuhrman: The long term.
Alex Fuhrman: The agreement, we made with Disney National Geographic was.
Alex Fuhrman: The National Geographic brand in Europe is really really important.
Alex Fuhrman: And we believe will help us a great deal.
Alex Fuhrman: We suspect that polar regions will be very very popular.
Alex Fuhrman: Certainly Alaska absolutely.
Alex Fuhrman: And so we see quite a bit.
Alex Fuhrman: In all likelihood credit diverse participation.
Speaker Change: Okay. That's really helpful. Thank you and then can you talk a little bit about just the timeline of going after additional international markets.
Alex Fuhrman: Including Asia over time, when you talk about getting to something resembling normalized occupancy in 2006 is international going to be a big part of that or is that perhaps even longer tail opportunity down the road.
Speaker Change: Yes, we.
Speaker Change: We look at the international opportunity.
Alex Fuhrman: Potentially being significant over time, but.
Alex Fuhrman: We haven't sort of baked that into our thinking in any significant degree yet.
Alex Fuhrman: We believe that the.
Alex Fuhrman: Traditional mechanisms.
Alex Fuhrman: We have in place will get us to where we were talking about for 2006.
Alex Fuhrman: In the international business would be on top of that which is great and will accelerate our ability to grow.
Alex Fuhrman: So.
Alex Fuhrman: This is I would say this is very much an experimental phase still as it relates to Europe, we literally just signed on a GSA in Britain, a couple of months ago.
Alex Fuhrman: We are now going to there's a lot of interest in Holland, and Belgium, Switzerland for example.
Alex Fuhrman: As there are large English speaking population, we feel that thats, probably the best way for us to go into Beaumont. We have started doing some work in India, which is.
Alex Fuhrman: I know for a fact that more and more people without us even having made an accurate.
Alex Fuhrman: Joining our expeditions from India.
Alex Fuhrman: We have some charters in China.
Alex Fuhrman: We are beginning to experiment with so.
Speaker Change: All right.
Alex Fuhrman: I think by next year, we will have be able to be much more specific in terms of how we feel this is going to develop.
Speaker Change: Okay. That's really helpful. Thank you very much.
Speaker Change: Thank you.
Speaker Change: Yes.
Speaker Change: Our next question comes from the line of David <unk> with Barclays. Please go ahead.
Speaker Change: Thanks very much.
David: Great quarter, I was curious as to what happened with the tax inflection.
David: And maybe I missed it I didn't hear.
Speaker Change: What happened there.
Speaker Change: Yeah, David I'll have to follow up with you on that post the call. Let me, let me get that data in front of me and I will give you a call.
Speaker Change: It doesn't look like there was a write down or anything of that nature. So just wondering.
Speaker Change: And then when we look at the market, we only I mean, our cash taxes, it's all sort of.
Speaker Change: Counting our cash taxes this year will be a couple million dollars.
Speaker Change: The $2 million, so we have significant Nols.
Speaker Change: But I'll get I'll get you the accounting answer on that.
Speaker Change: Okay.
Speaker Change: When we look at your margins now with the commissions and royalties under the new contract is that fully reflected or are we going to see that.
Speaker Change: Being.
Speaker Change: Implemented over time.
Speaker Change: You'll see it being implemented over time, it's not fully reflected so I think we've talked about on past calls that the Disney Nash.
Speaker Change: National Geographic or agreement there is there are step ups in part because the <unk>.
Speaker Change: Benefits that we're going to be fully receiving from all the activities take the nine month booking window. It takes some time to come to fruition. So the.
Speaker Change: The step ups happen.
Speaker Change: Next year, there is a more modest step up and then there's another step up in 2026.
Speaker Change: But we haven't for strategic reasons.
Speaker Change: Closed what those amounts are.
Speaker Change: Okay, I'm, just wondering where we are ending wise.
Speaker Change: Thank you very much.
Speaker Change: Thank you.
Speaker Change: That concludes today's Q&A session I would now like to turn the call back to Dyson.
Speaker Change: For closing remarks.
Speaker Change: Well. Thank you again, everyone for joining the call today, we're really pleased with the momentum we have across the business and if you have any further questions for our team spend and I will be happy to answer them just reach out.
Speaker Change: Thank you everybody.
Speaker Change: This concludes today's call you may now disconnect.
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