- Q2’22 results significantly better than expected and full
year expectations raised
- Strong momentum continues at GES and Pursuit
- Poised for continued growth in 2023 and beyond
Viad Corp (NYSE: VVI), a leading provider of experiential
leisure travel and live events and marketing experiences, today
reported net income attributable to Viad of $19.8 million for the
2022 second quarter.
Steve Moster, Viad’s president and chief executive officer,
commented, “Our second quarter results were significantly better
than our prior guidance as the recovery of in-person event activity
has progressed more quickly than we had previously anticipated.
Both GES and Pursuit posted substantial year-over-year growth and
positive Adjusted EBITDA during the quarter. GES’ second quarter
revenue reached 75 percent of the pre-pandemic 2019 second quarter,
while Pursuit delivered record second quarter revenue that was 40
percent greater than the 2019 quarter driven by our new
experiences.”
Moster continued, “I am encouraged by the strong momentum we are
seeing across our businesses. Based on current trends and our first
half performance, we are raising our full year 2022 guidance for
consolidated Adjusted EBITDA. I am even more excited about our
future earnings potential as recovery continues in our industries
and we reap the benefits of our actions to scale Pursuit, transform
GES Exhibitions’ cost structure, and strengthen Spiro’s
capabilities.”
Second Quarter 2022 Financial
Highlights
Three months ended June
30,
(in millions)
2022
2021
$ Change
Revenue
$
319.2
$
61.2
$
258.0
Pursuit Revenue
77.6
36.3
41.3
GES Revenue
241.6
24.9
216.7
Net income (loss) attributable to
Viad
$
19.8
$
(42.0
)
$
61.9
Consolidated Adjusted EBITDA*
$
47.5
$
(21.9
)
$
69.4
Pursuit Adjusted EBITDA*
15.6
2.0
13.6
GES Adjusted EBITDA*
35.1
(21.6
)
56.7
Corporate Adjusted EBITDA*
(3.3
)
(2.4
)
(0.9
)
* Refer to Table Two of this press release for a discussion and
reconciliation of this non-GAAP financial measure to its most
directly comparable GAAP financial measure.
Net income attributable to Viad improved by $61.9 million from
the 2021 second quarter primarily driven by higher revenue at GES
and Pursuit.
Pursuit Results
Pursuit’s second quarter revenue increased $41.3 million from
the 2021 quarter. Pursuit’s same-store revenue from experiences
that were owned and open prior to 2021 was $68.2 million, up $35.0
million from the 2021 second quarter primarily due to stronger
visitation at our Canadian experiences, which were impacted in 2021
by border restrictions. Revenue from new experiences opened or
acquired after 2020 was $9.4 million versus $3.1 million in the
prior year quarter, reflecting the continued ramping of Sky Lagoon
and Golden Skybridge and the additions of FlyOver Las Vegas and
Glacier Raft Company.
Pursuit’s second quarter adjusted EBITDA increased by $13.6
million versus the 2021 second quarter primarily due to the
increase in revenue.
Regarding Pursuit’s results, Moster commented, “Pursuit posted
very strong year-over-year growth with revenue vastly exceeding the
same period in 2019 due to the investments we have made to scale
the business. The level of growth was not as strong as we had
previously expected primarily due to challenging weather conditions
that impacted visitation. Nonetheless, I am very pleased with
Pursuit’s second quarter performance and encouraged by the strong
booking pace across our lodging properties and the improvements we
are seeing in attraction visitation.”
Moster continued, “With the Canadian border open, the new
experiences we have added, and strong leisure travel demand, we
expect Pursuit’s revenue will remain much higher than the levels we
realized in 2021. As long-haul international tourism continues to
recover and awareness of our newest attractions builds, we expect
strong revenue growth and continued margin expansion beyond
2022.”
GES Results
GES’ second quarter revenue increased $216.7 million from the
2021 second quarter and Adjusted EBITDA improved by $56.7 million.
These improvements are primarily due to the resumption of live
event activity and the return of large-scale events that canceled
or postponed into the first half of 2021, as well as the benefit of
the cost structure reductions we’ve implemented.
Regarding GES’ overall results, Moster commented, “GES’ second
quarter results once again exceeded our expectations due to a
faster than expected rebound of event activity. Spiro continues to
win new logos and benefit from increased client spend. And within
the GES Exhibitions segment, we realized our fourth consecutive
quarter of same-show revenue improvement, with revenue from U.S.
events that we produced reaching 87 percent of pre-pandemic levels
on average. We also experienced strong flow-through on the increase
in revenue reflecting the benefit of the transformational changes
we have made to the cost structure of GES Exhibitions.”
Moster continued, “I am very encouraged by the industry trends
we’re seeing and more importantly by how Spiro and GES Exhibitions
are performing as our industry rebounds. I am confident that the
actions we took during the pandemic have positioned GES Exhibitions
and Spiro for greater success in the future.”
The following table provides a comparison of 2022 second quarter
revenue and Adjusted EBITDA to the comparable period in 2021 for
GES’ two reportable segments.
Three months ended June
30,
(in millions)
2022
2021
$ Change
Revenue:
Spiro
$
89.4
$
11.9
$
77.5
GES Exhibitions
154.6
13.1
141.5
Inter-segment Eliminations
(2.4
)
(0.1
)
(2.3
)
Total GES
$
241.6
$
24.9
$
216.7
Adjusted EBITDA*:
Spiro
$
15.8
$
(6.1
)
$
21.8
GES Exhibitions
19.4
(15.5
)
34.9
Total GES
$
35.1
$
(21.6
)
$
56.7
* Refer to Table Two of this press release for a discussion and
reconciliation of this non-GAAP financial measure to its most
directly comparable GAAP financial measure.
Balance Sheet and Cash Flow Highlights
We ended the second quarter with total liquidity of $127
million, comprising cash and cash equivalents of approximately $55
million and approximately $72 million of capacity available on our
revolving credit facility ($100 million total facility size, less
$15 million of borrowings and approximately $13 million in letters
of credit). Our debt totaled approximately $492 million, including
$397 million outstanding on our Term Loan B, financing lease
obligations of approximately $65 million (which primarily comprises
real estate leases at Pursuit), revolver borrowings of $15 million,
and approximately $15 million in other debt.
Our 2022 second quarter cash flow from operations was an inflow
of approximately $26 million, our capital expenditures totaled
approximately $19 million, we acquired Glacier Raft Company for
approximately $25 million (net of cash acquired), and we paid
approximately $2 million in cash dividends on our convertible
preferred equity. Our net debt borrowings during the quarter were
approximately $20 million, including $15 million on our revolver to
partially fund the acquisition of Glacier Raft Company and
approximately $9 million on a construction loan to help fund
development of our new Forest Park Hotel in Jasper National
Park.
Moster commented, “We continue to focus on prudent cash
management to maintain a strong liquidity position while also
making smart investments in high-return growth opportunities
through Pursuit’s Refresh, Build, Buy strategy, including our April
6th acquisition of the Glacier Raft Company and construction of our
new Forest Park Hotel in Jasper.”
2022 Outlook
Regarding Viad’s outlook, Moster commented, “We continue to
expect very strong year-over-year growth from both Pursuit and GES
and we are increasing our full year guidance for consolidated
Adjusted EBITDA. This improved outlook is the result of GES’
stronger than previously expected performance during the second
quarter, partially offset by a reduced outlook for Pursuit’s
year-over-year growth primarily due to the impact of the inclement
weather experienced during the second quarter and revised
expectations for visitation ramp up at FlyOver Las Vegas.”
Assuming no future material adverse changes to the macro
environment from COVID, geo-political events, or other factors, we
expect Adjusted EBITDA will be in the ranges shown in the following
table. We continue to operate in a very dynamic environment and our
performance could vary significantly from the amounts shown
below.
(in millions)
Third Quarter
Full Year
Key Assumptions
Pursuit
$74 to $82
(vs. $59.6 in 2021)
$70 to $80
(vs. $42.7 in 2021 and prior
guidance of $80 to $90)
- US same store revenue outperforms 2019 on strong leisure travel
demand and benefit from continued investment in the guest
experience
- Canada same store revenue remains below 2019 as certain
long-haul international leisure travel markets are slower to
recover
- New experiences continue to ramp up as guest awareness builds
and long-haul leisure travel demand increases
- Revenue management efforts to drive rate increases help offset
wage rate and other inflationary pressures
- Margins will improve from 2021, but remain below 2019 due to
guest mix that will see strong demand from N. America and Europe
while Asia Pacific markets are slower to recover
GES
$6 to $11
(vs. negative $4.2 in 2021)
$50 to $60
(vs. negative $30.4 in 2021 and
prior guidance of $25 to $35)
- Exhibitions same-show revenue will generally remain at or
better than 75% of pre-pandemic levels
- Experiential marketing budgets of major Spiro clients will
remain at 80%+ of pre-pandemic levels
- SG&A will gradually increase to support increased business
activity and future revenue growth
Corporate
~$(3.5)
$(12.5) to $(13.5)
- Second half of 2022 is slightly higher than first half
primarily due to timing of certain expenses
Conference Call Details
Management will host a conference call to review second quarter
2022 results on Thursday, August 4, 2022, at 5 p.m. (Eastern
Time).
To join the live conference call, please register at least 10
minutes before the start of the call using the following link:
https://conferencingportals.com/event/KFfVIwkJ. After registering,
an email confirmation will be sent that includes dial-in
information as well as unique codes for entry into the live call.
Registration will be open throughout the call.
A live audio webcast of the call will also be available in
listen-only mode through the "Investors" section of our website. A
replay of the webcast will be available on our website shortly
after the call and, for a limited time, by calling (800) 770-2030
or (647) 362-9199 and entering the conference ID 90039.
Additionally, we will post a supplemental presentation,
containing highlights of our results, trends and outlook, on the
“Investors” section of our website prior to the conference call. We
will refer to this presentation during the call.
About Viad
Viad (NYSE: VVI) is a leading global provider of extraordinary
experiences, including hospitality and leisure activities,
experiential marketing, and live events through two businesses:
Pursuit and GES. Our business strategy focuses on delivering
extraordinary experiences for our teams, clients and guests, and
significant and sustainable growth and above-market returns for our
shareholders. Viad is an S&P SmallCap 600 company.
Pursuit is a collection of inspiring and unforgettable travel
experiences in Alaska, Montana, the Canadian Rockies, Vancouver,
Reykjavik, and Las Vegas, as well as new experiences planned in
Chicago and Toronto. Pursuit’s collection includes attractions,
lodges and hotels, and sightseeing tours that connect guests with
iconic places.
GES is a global, full-service live events company offering a
comprehensive range of services to the world's leading brands and
event organizers through two reportable segments, Spiro and GES
Exhibitions. Spiro is an experiential marketing agency that
partners with leading brands around the world to manage and elevate
their global experiential marketing activities. GES Exhibitions is
a global exhibition services company that partners with leading
exhibition and conference organizers as a full-service provider of
strategic and logistics solutions to manage the complexity of their
shows with teams throughout North America, Europe, and the Middle
East.
For more information, visit www.viad.com.
Forward-Looking Statements
This press release contains a number of forward-looking
statements. Words, and variations of words, such as “will,” “may,”
“expect,” “would,” “could,” “might,” “intend,” “plan,” “believe,”
“estimate,” “anticipate,” “deliver,” “seek,” “aim,” “potential,”
“target,” “outlook,” and similar expressions are intended to
identify our forward-looking statements. Similarly, statements that
describe our business strategy, outlook, objectives, plans,
intentions, or goals also are forward-looking statements. These
forward-looking statements are not historical facts and are subject
to a host of risks and uncertainties, many of which are beyond our
control, which could cause actual results to differ materially from
those in the forward-looking statements.
Important factors that could cause actual results to differ
materially from those described in our forward-looking statements
include, but are not limited to, the following:
- the impact of the COVID-19 pandemic on our financial condition,
liquidity, and cash flow;
- our ability to anticipate and adjust for the impact of the
COVID-19 pandemic on our businesses;
- general economic uncertainty in key global markets and a
worsening of global economic conditions;
- travel industry disruptions;
- seasonality of our businesses;
- unanticipated delays and cost overruns of our capital projects,
and our ability to achieve established financial and strategic
goals for such projects;
- our exposure to labor shortages, turnover, and labor cost
increases;
- the importance of key members of our account teams to our
business relationships;
- the competitive nature of the industries in which we
operate;
- our dependence on large exhibition event clients;
- adverse effects of show rotation on our periodic results and
operating margins;
- transportation disruptions and increases in transportation
costs;
- natural disasters, weather conditions, accidents, and other
catastrophic events;
- our exposure to labor cost increases and work stoppages related
to unionized employees;
- our multi-employer pension plan funding obligations;
- our ability to successfully integrate and achieve established
financial and strategic goals from acquisitions;
- our exposure to cybersecurity attacks and threats;
- our exposure to currency exchange rate fluctuations;
- liabilities relating to prior and discontinued operations;
and
- compliance with laws governing the storage, collection,
handling, and transfer of personal data and our exposure to legal
claims and fines for data breaches or improper handling of such
data.
For a more complete discussion of the risks and uncertainties
that may affect our business or financial results, please see Item
1A, “Risk Factors,” of our most recent annual report on Form 10-K
filed with the SEC. We disclaim and do not undertake any obligation
to update or revise any forward-looking statement in this press
release except as required by applicable law or regulation.
Forward-Looking Non-GAAP Measures
The company has not quantitatively reconciled its guidance for
adjusted EBITDA to its respective most comparable GAAP financial
measure because certain reconciling items that impact this metric
including, provision for income taxes, interest expense,
restructuring or impairment charges, acquisition-related costs, and
attraction start-up costs have not occurred, are out of the
company’s control, or cannot be reasonably predicted. Accordingly,
reconciliations to the nearest GAAP financial measure are not
available without unreasonable effort. Please note that the
unavailable reconciling items could significantly impact the
company’s results as reported under GAAP.
VIAD CORP AND SUBSIDIARIES TABLE ONE - QUARTERLY
RESULTS (UNAUDITED)
Three months ended June 30,
Six months ended June 30,
(in thousands, except per share data)
2022
2021
$ Change
% Change
2022
2021
$ Change
% Change
Revenue: Pursuit
$
77,599
$
36,313
$
41,286
**
101,383
46,103
55,280
** GES: Spiro
89,425
11,944
77,481
**
$
132,241
$
24,003
$
108,238
** GES Exhibitions
154,600
13,057
141,543
**
266,431
20,209
246,222
** Inter-segment eliminations
(2,421
)
(81
)
(2,340
)
**
(3,492
)
(147
)
(3,345
)
** Total GES
241,604
24,920
216,684
**
$
395,180
$
44,065
$
351,115
**
Total revenue
$
319,203
$
61,233
$
257,970
**
$
496,563
$
90,168
$
406,395
**
Segment operating income (loss) Pursuit
$
5,571
$
(8,097
)
13,668
**
(15,627
)
(26,418
)
10,791
40.8
%
GES: Spiro
14,847
(7,211
)
22,058
**
14,608
(14,380
)
$
28,988
** GES Exhibitions
16,273
(19,686
)
35,959
**
14,918
(32,421
)
47,339
** Total GES
31,120
(26,897
)
58,017
**
29,526
(46,801
)
76,327
**
Segment operating income (loss)
$
36,691
$
(34,994
)
$
71,685
**
$
13,899
$
(73,219
)
$
87,118
** Corporate eliminations
17
18
(1
)
-5.6
%
34
35
(1
)
-2.9
%
Corporate activities (Note A)
(3,440
)
(3,006
)
(434
)
-14.4
%
(6,113
)
(5,011
)
(1,102
)
-22.0
%
Restructuring charges (Note B)
(1,426
)
(787
)
(639
)
-81.2
%
(2,080
)
(3,613
)
1,533
42.4
%
Impairment charges
-
-
-
**
(583
)
-
(583
)
** Pension plan withdrawal
-
(57
)
57
-100.0
%
-
(57
)
57
-100.0
%
Other expense
(612
)
(680
)
68
10.0
%
(1,250
)
(1,040
)
(210
)
-20.2
%
Net interest expense (Note C)
(7,761
)
(5,565
)
(2,196
)
-39.5
%
(13,638
)
(10,650
)
(2,988
)
-28.1
%
Income (loss) from continuing operations before income taxes
23,469
(45,071
)
68,540
**
(9,731
)
(93,555
)
83,824
89.6
%
Income tax (expense) benefit (Note D)
(3,359
)
2,166
(5,525
)
**
(777
)
5,211
(5,988
)
** Income (loss) from continuing operations
20,110
(42,905
)
63,015
**
(10,508
)
(88,344
)
77,836
88.1
%
Income (loss) from discontinued operations
52
(62
)
114
**
327
286
41
14.3
%
Net income (loss)
20,162
(42,967
)
63,129
**
(10,181
)
(88,058
)
77,877
88.4
%
Net (income) loss attributable to noncontrolling interest
(451
)
510
(961
)
**
753
1,955
(1,202
)
-61.5
%
Net loss attributable to redeemable noncontrolling interest
128
431
(303
)
-70.3
%
266
925
(659
)
-71.2
%
Net income (loss) attributable to Viad
$
19,839
$
(42,026
)
$
61,865
**
$
(9,162
)
$
(85,178
)
$
76,016
89.2
%
Amounts Attributable to Viad: Income (loss) from
continuing operations
$
19,787
$
(41,964
)
$
61,751
**
$
(9,489
)
$
(85,464
)
$
75,975
88.9
%
Income (loss) from discontinued operations
52
(62
)
114
**
327
286
41
14.3
%
Net income (loss)
$
19,839
$
(42,026
)
$
61,865
**
$
(9,162
)
$
(85,178
)
$
76,016
89.2
%
Income (loss) per common share attributable to Viad (Note
E): Basic income (loss) per common share
$
0.64
$
(2.18
)
$
2.82
**
$
(0.67
)
$
(4.40
)
$
3.73
84.8
%
Diluted income (loss) per common share
$
0.64
$
(2.18
)
$
2.82
**
$
(0.67
)
$
(4.40
)
$
3.73
84.8
%
Weighted-average common shares outstanding: Basic
weighted-average outstanding common shares
20,571
20,397
174
0.9
%
20,544
20,384
160
0.8
%
Additional dilutive shares related to share-based compensation
160
-
160
**
-
-
-
** Diluted weighted-average outstanding common shares
20,731
20,397
334
1.6
%
20,544
20,384
160
0.8
%
Adjusted EBITDA* by Reportable Segment: Pursuit
$
15,613
$
2,011
$
13,602
**
$
4,115
$
(7,050
)
$
11,165
** GES: Spiro
15,750
(6,057
)
21,807
**
16,492
(11,599
)
28,091
** GES Exhibitions
19,381
(15,504
)
34,885
**
21,359
(24,188
)
45,547
** Total GES
35,131
(21,561
)
56,692
**
37,851
(35,787
)
73,638
** Corporate
(3,268
)
(2,395
)
(873
)
-36.5
%
(5,802
)
(4,326
)
(1,476
)
-34.1
%
Consolidated Adjusted EBITDA
47,476
(21,945
)
69,421
**
36,164
(47,163
)
83,327
** As of June 30,
Capitalization Data:
2022
2021
$ Change
% Change
Cash and cash equivalents
54,516
37,037
17,479
47.2
%
Total debt
492,297
399,665
92,632
23.2
%
Viad shareholders' equity
(7,591
)
18,751
(26,342
)
** Non-controlling interests (redeemable and non-redeemable)
88,779
89,141
(362
)
-0.4
%
Convertible Series A Preferred Stock (Note F): Convertible
preferred stock (including accumulated dividends paid in kind)***
141,827
141,827
-
0.0
%
Equivalent number of common shares
6,674
6,674
-
0.0
%
* Refer to Table Two for a discussion and reconciliation of
this non-GAAP financial measure to its most directly comparable
GAAP financial measure. ** Change is greater than +/- 100 percent
*** Amount shown excludes transaction costs, which are netted
against the value of the preferred shares when presented on Viad's
balance sheet.
VIAD CORP AND SUBSIDIARIES TABLE ONE -
NOTES TO QUARTERLY RESULTS (UNAUDITED) (A)
Corporate Activities — The increase in corporate activities expense
during the three and six months ended June 30, 2022 was primarily
due to higher performance-based compensation expense. (B)
Restructuring Charges — Restructuring charges during the three and
six months ended June 30, 2022 were primarily related to severance
and facility closures at GES. Restructuring charges during the
three and six months ended June 30, 2021 were primarily related to
facility closures at GES. In response to the COVID-19 pandemic, we
accelerated our transformation and streamlining efforts at GES to
significantly reduce costs and create a lower and more flexible
cost structure focused on servicing our more profitable market
segments. (C) Net Interest Expense — The increase in
interest expense during the three and six months ended June 30,
2022 was primarily due to higher interest rates and higher debt
balances in 2022, offset in part by $0.7 million in capitalized
interest recorded during the three months ended June 30,2022 and
$2.6 million during the six months ended June 30, 2022. (D)
Income Tax (Expense) Benefit – The effective tax rate was 14.3% for
the three months ended June 30, 2022 and 4.8% for the three months
ended June 30, 2021. The effective tax rate was a negative 8.0% for
the six months ended June 30, 2022 and 5.6% for six months ended
June 30, 2021. The effective tax rates were lower than the blended
statutory rate primarily as a result of excluding the tax benefit
on losses recognized in the United States, the United Kingdom, and
other European countries where we have a valuation allowance. The
six months ended June 30, 2022 was also impacted by a change in
income or loss between jurisdictions. (E) Income (Loss) per
Common Share — We apply the two-class method in calculating income
(loss) per common share as preferred stock and unvested share-based
payment awards that contain nonforteitable rights to dividends are
considered participating securities. Accordingly, such securities
are included in the earnings allocation in calculating income per
share. Diluted income (loss) per common share is calculated using
the more dilutive of the two-class method or as-converted method.
The two-class method uses net income (loss) available to common
stockholders and assumes conversion of all potential shares other
than participating securities. The as-converted method uses net
income (loss) available to common shareholders and assumes
conversion of all potential shares including participating
securities. Dilutive potential common shares include outstanding
stock options, unvested restricted share units and convertible
preferred stock. Additionally, the adjustment to the carrying value
of redeemable non-controlling interests is reflected in income
(loss) per common share. The components of basic and diluted income
(loss) per share are as follows:
Three months ended June 30,
Six months ended June 30,
(in thousands)
2022
2021
$ Change
% Change
2022
2021
$ Change
% Change
Net income (loss) attributable to Viad
$
19,839
$
(42,026
)
$
61,865
**
$
(9,162
)
$
(85,178
)
$
76,016
89.2
%
Convertible preferred stock dividends paid in cash
(1,950
)
-
(1,950
)
**
(3,900
)
-
(3,900
)
** Convertible preferred stock dividends paid in kind
-
(1,923
)
1,923
-100.0
%
-
(3,821
)
3,821
-100.0
%
Adjustment to the redemption value of redeemable noncontrolling
interest
(412
)
(547
)
135
24.7
%
(763
)
(603
)
(160
)
-26.5
%
Undistributed income (loss) attributable to Viad
17,477
(44,496
)
61,973
**
(13,825
)
(89,602
)
75,777
84.6
%
Less: Allocation to participating securities
(4,293
)
-
(4,293
)
**
-
-
-
**
Net income (loss) allocated to Viad common shareholders
(basic)
$
13,184
$
(44,496
)
$
57,680
**
$
(13,825
)
$
(89,602
)
$
75,777
84.6
%
Add: Allocation to participating securities
25
-
-
**
-
-
-
**
Net income (loss) allocated to Viad common shareholders
(diluted)
$
13,209
$
(44,496
)
$
57,680
**
$
(13,825
)
$
(89,602
)
$
75,777
84.6
%
Basic weighted-average outstanding common shares
20,571
20,397
174
0.9
%
20,544
20,384
160
0.8
%
Additional dilutive shares related to share-based compensation
160
-
160
**
-
-
-
**
Diluted weighted-average outstanding common shares
20,731
20,397
334
1.6
%
20,544
20,384
160
0.8
%
(F) Convertible Series A Preferred Stock — On August
5, 2020, we entered into an Investment Agreement with funds managed
by private equity firm Crestview Partners, relating to the issuance
of 135,000 shares of newly issued Convertible Series A Preferred
Stock, par value $0.01 per share, for an aggregate purchase price
of $135 million or $1,000 per share. The Convertible Series A
Preferred Stock carries a 5.5% cumulative quarterly dividend, which
is payable in cash or in-kind at Viad’s option and is convertible
into shares of our common stock at a conversion price of $21.25 per
share. A total of $6.8 million of dividends have been paid in kind,
including $3.8 million during the first and second quarters of
2021. We began paying preferred stock dividends in cash during the
2021 third quarter and we intend to pay in cash for the foreseeable
future.
VIAD CORP AND SUBSIDIARIES TABLE TWO - NON-GAAP
FINANCIAL MEASURES (UNAUDITED) IMPORTANT
DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES This
document includes the presentation of "Income (Loss) Before Other
Items", "Adjusted EBITDA", "Segment Operating Income (Loss)", and
"Adjusted Segment Operating Income (Loss)", which are supplemental
to results presented under accounting principles generally accepted
in the United States of America (“GAAP”) and may not be comparable
to similarly titled measures presented by other companies. These
non-GAAP measures are utilized by management to facilitate
period-to-period comparisons and analysis of Viad’s operating
performance and should be considered in addition to, but not as
substitutes for, other similar measures reported in accordance with
GAAP. The use of these non-GAAP financial measures is limited,
compared to the GAAP measure of net income attributable to Viad,
because they do not consider a variety of items affecting Viad’s
consolidated financial performance as reconciled below. Because
these non-GAAP measures do not consider all items affecting Viad’s
consolidated financial performance, a user of Viad’s financial
information should consider net income attributable to Viad as an
important measure of financial performance because it provides a
more complete measure of the Company’s performance. Income
(Loss) Before Other Items, Segment Operating Income (Loss), and
Adjusted Segment Operating Income (Loss) are considered useful
operating metrics, in addition to net income attributable to Viad,
as potential variations arising from non-operational
expenses/income are eliminated, thus resulting in additional
measures considered to be indicative of Viad’s performance.
Management believes that the presentation of Adjusted EBITDA
provides useful information to investors regarding Viad’s results
of operations for trending, analyzing and benchmarking the
performance and value of Viad’s business. Management also believes
that the presentation of Adjusted EBITDA for acquisitions and other
major capital projects enables investors to assess how effectively
management is investing capital into major corporate development
projects, both from a valuation and return perspective.
Three months ended June 30, Six months ended June 30, (in
thousands, except per share data)
2022
2021
$ Change
% Change
2022
2021
$ Change
% Change
Income (loss) before other items: Net income (loss)
attributable to Viad
$
19,839
$
(42,026
)
$
61,865
**
$
(9,162
)
$
(85,178
)
$
76,016
89.2
%
(Income) loss from discontinued operations attributable to Viad
(52
)
62
(114
)
**
(327
)
(286
)
(41
)
-14.3
%
Income (loss) from continuing operations attributable to Viad
19,787
(41,964
)
61,751
**
(9,489
)
(85,464
)
75,975
88.9
%
Restructuring charges, pre-tax
1,426
787
639
81.2
%
2,080
3,613
(1,533
)
-42.4
%
Impairment charges, pre-tax
-
-
-
**
583
-
583
** Pension plan withdrawal, pre-tax
-
57
(57
)
-100.0
%
-
57
(57
)
-100.0
%
Acquisition-related costs and other non-recurring expenses, pre-tax
(Note A)
1,001
2,704
(1,703
)
-63.0
%
1,858
4,522
(2,664
)
-58.9
%
Tax benefit on above items
(61
)
(141
)
80
56.7
%
(138
)
(318
)
180
56.6
%
Income (loss) before other items
$
22,153
$
(38,557
)
$
60,710
**
$
(5,106
)
$
(77,590
)
$
72,484
93.4
%
The components of income (loss) before other items
per share are as follows: Income (loss) before other items
(as reconciled above)
22,153
(38,557
)
60,710
**
(5,106
)
(77,590
)
72,484
93.4
%
Convertible preferred stock dividends paid in cash
(1,950
)
-
(1,950
)
**
(3,900
)
-
(3,900
)
** Convertible preferred stock dividends paid in kind
-
(1,923
)
1,923
-100.0
%
-
(3,821
)
3,821
-100.0
%
Undistributed income (loss) before other items attributable to Viad
(Note B)
20,203
(40,480
)
60,683
**
(9,006
)
(81,411
)
72,405
88.9
%
Less: Allocation to participating securities (Note C)
(4,934
)
-
(4,934
)
**
-
-
-
** Diluted income (loss) before other items allocated to Viad
common shareholders
$
15,269
$
(40,480
)
$
55,749
**
$
(9,006
)
$
(81,411
)
$
72,405
88.9
%
Diluted weighted-average outstanding common shares
20,731
20,397
334
1.6
%
20,544
20,384
160
0.8
%
Income (loss) before other items per common share
$
0.74
$
(1.98
)
$
2.72
**
$
(0.44
)
`
$
(3.99
)
$
3.55
89.0
%
(A) Acquisition-related costs and other non-recurring
expenses include: Three months ended June 30, Six months ended June
30, (in thousands)
2022
2021
2022
2021
Acquisition integration costs - Pursuit1
$
119
$
5
$
119
$
6
Acquisition transaction-related costs - Pursuit1
93
64
401
272
Acquisition transaction-related costs - Corporate2
(2
)
24
108
59
Attraction start-up costs1, 3
648
2,054
1,079
3,618
Other non-recurring expenses2, 4
143
557
151
567
Acquisition-related and other non-recurring expenses, pre-tax
$
1,001
$
2,704
$
1,858
$
4,522
1 Included in segment operating loss 2 Included in corporate
activities 3 Includes costs related to the development of Pursuit's
new FlyOver attractions in Las Vegas, Chicago, and Toronto, the Sky
Lagoon in Iceland, the Golden Skybridge and Forest Park Hotel in
Canada. 4 Includes non-capitalizable fees and expenses related to
Viad’s credit facility refinancing efforts. (B) We exclude
the adjustment to the redemption value of redeemable noncontrolling
interest from the calculation of income before other items per
share as it is a non-cash adjustment that does not affect net
income or loss attributable to Viad. (C) Preferred stock and
unvested share-based payment awards that contain nonforteitable
rights to dividends are considered participating securities.
Accordingly, such securities are included in the earnings
allocation in calculating income (loss) before other items per
common share unless the effect of such inclusion is anti-dilutive.
The following table provides the share data used for calculating
the allocation to participating securities if applicable: Three
months ended June 30, Six months ended June 30, (in thousands)
2022
2021
2022
2021
Weighted-average outstanding common shares
20,731
20,397
20,544
20,384
Effect of participating convertible preferred shares (if
applicable)
6,674
-
-
-
Effect of participating non-vested shares (if applicable)
25
-
-
-
Weighted-average shares including effect of participating interests
(if applicable)
27,430
20,397
20,544
20,384
** Change is greater than +/- 100 percent
VIAD CORP AND
SUBSIDIARIES TABLE TWO - NON-GAAP FINANCIAL MEASURES
(CONTINUED) (UNAUDITED) Same-Store - The term
"same-store" is used within this document to refer to results
without the impact of new experiences, if any, until such new
experiences are included in the entirety of both comparable
periods. Management believes that the presentation of "same-store"
results permits investors to better understand Viad's performance
without the effects of new experiences. Three months ended
June 30, 2022 Three months ended June 30, 2021 ($ in thousands) As
Reported NewExperiences(Note A) Same-Store As Reported
NewExperiences(Note A) Same-Store
Viad Consolidated:
Revenue
$
319,203
$
9,365
$
309,838
$
61,233
$
3,127
$
58,106
Net income (loss) attributable to Viad
$
19,839
$
(42,026
)
Net income (loss) attributable to noncontrolling interest
451
(510
)
Net loss attributable to redeemable noncontrolling interest
(128
)
(431
)
(Income) loss from discontinued operations
(52
)
62
Net interest expense
7,761
5,565
Income tax expense (benefit)
3,359
(2,166
)
Depreciation and amortization
13,207
13,333
Restructuring charges
1,426
787
Other expense
612
680
Pension plan withdrawal
-
57
Start-up costs (B)
648
2,054
Acquisition transaction-related costs
91
88
Integration costs
119
5
Other non-recurring expenses (C)
143
557
Consolidated Adjusted EBITDA
$
47,476
$
271
$
47,205
$
(21,945
)
$
1,051
$
(22,996
)
Consolidated Adjusted EBITDA by Business: Pursuit
$
15,613
$
271
$
15,342
$
2,011
$
1,051
$
960
Total GES
35,131
-
35,131
(21,561
)
-
(21,561
)
Total Segment EBITDA
50,744
271
50,473
(19,550
)
1,051
(20,601
)
Corporate EBITDA
(3,268
)
-
(3,268
)
(2,395
)
-
(2,395
)
Consolidated Adjusted EBITDA
$
47,476
$
271
$
47,205
$
(21,945
)
$
1,051
$
(22,996
)
Pursuit Adjusted EBITDA: Revenue
$
77,599
$
9,365
$
68,234
$
36,313
$
3,127
$
33,186
Cost of services and products
(72,028
)
(11,640
)
(60,388
)
(44,410
)
(4,611
)
(39,799
)
Segment operating income (loss)
5,571
(2,275
)
7,846
(8,097
)
(1,484
)
(6,613
)
Depreciation
7,866
1,334
6,532
6,546
42
6,504
Amortization
1,316
445
871
1,439
439
1,000
Start-up costs (B)
648
648
-
2,054
2,054
-
Acquisition transaction-related costs
93
-
93
64
-
64
Integration costs
119
119
-
5
-
5
Adjusted EBITDA
$
15,613
$
271
$
15,342
$
2,011
$
1,051
$
960
Pursuit Operating margin
7.2
%
-24.3
%
11.5
%
-22.3
%
-47.5
%
-19.9
%
Pursuit Adjusted EBITDA margin
20.1
%
2.9
%
22.5
%
5.5
%
33.6
%
2.9
%
Total GES Adjusted EBITDA: Revenue
$
241,604
$
-
$
241,604
$
24,920
$
-
$
24,920
Cost of services and products
(210,484
)
-
(210,484
)
(51,817
)
-
(51,817
)
Segment operating income (loss)
31,120
-
31,120
(26,897
)
-
(26,897
)
Depreciation
2,922
-
2,922
4,116
-
4,116
Amortization
1,089
-
1,089
1,220
-
1,220
Total GES Adjusted EBITDA
$
35,131
$
-
$
35,131
$
(21,561
)
$
-
$
(21,561
)
Total GES Operating margin
12.9
%
12.9
%
** ** Total GES Adjusted EBITDA margin
14.5
%
14.5
%
-86.5
%
-86.5
%
GES Adjusted EBITDA by Reportable Segment: Spiro
$
15,750
$
15,750
$
(6,057
)
$
(6,057
)
GES Exhibitions
19,381
19,381
(15,504
)
(15,504
)
Total GES
$
35,131
$
-
$
35,131
$
(21,561
)
$
-
$
(21,561
)
Spiro Revenue
$
89,425
$
-
$
89,425
$
11,944
$
-
$
11,944
Spiro Adjusted EBITDA Margin
17.6
%
17.6
%
-50.7
%
-50.7
%
GES Exhibitions Revenue
$
154,600
$
-
$
154,600
$
13,057
$
-
$
13,057
GES Exhibitions Adjusted EBITDA Margin
12.5
%
12.5
%
** ** (A) New Experiences comprises the following
attractions that were opened or acquired after January 1, 2021: Sky
Lagoon (opened May 2021), Golden Skybridge (acquired March 2021 and
opened June 2021), FlyOver Las Vegas (opened September 2021), and
Glacier Raft Company (acquired April 2022) and costs related to the
development of new experiences. (B) Includes costs related to the
development of Pursuit's new FlyOver attractions in Las Vegas,
Chicago, and Toronto, the Sky Lagoon in Iceland, and the Golden
Skybridge and Forest Park Hotel in Canada. (C) Includes
non-capitalizable fees and expenses related to Viad’s credit
facility refinancing efforts.
VIAD CORP AND SUBSIDIARIES
TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED) Same-Store - The term "same-store" is
used within this document to refer to results without the impact of
new experiences, if any, until such new experiences are included in
the entirety of both comparable periods. Management believes that
the presentation of "same-store" results permits investors to
better understand Viad's performance without the effects of new
experiences.
Six months ended June 30,
2022
Six months ended June 30,
2021
($ in thousands)
As Reported
New Experiences (Note A)
Same-Store
As Reported
New Experiences (Note A)
Same-Store
Viad Consolidated: Revenue
$
496,563
$
14,488
$
482,075
$
90,168
$
3,127
$
87,041
Net loss attributable to Viad
$
(9,162
)
$
(85,178
)
Net loss attributable to noncontrolling interest
(753
)
(1,955
)
Net loss attributable to redeemable noncontrolling interest
(266
)
(925
)
Income from discontinued operations
(327
)
(286
)
Net interest expense
13,638
10,650
Income tax expense (benefit)
777
(5,211
)
Depreciation and amortization
26,486
26,510
Restructuring charges
2,080
3,613
Impairment charges
583
-
Other expense
1,250
1,040
Pension plan withdrawal
-
57
Start-up costs (B)
1,079
3,618
Acquisition transaction-related costs
509
331
Integration costs
119
6
Other non-recurring expenses (C)
151
567
Consolidated Adjusted EBITDA
$
36,164
$
(133
)
$
36,297
$
(47,163
)
$
1,051
$
(48,214
)
Consolidated Adjusted EBITDA by Business: Pursuit
$
4,115
$
(133
)
$
4,248
$
(7,050
)
$
1,051
$
(8,101
)
Total GES
37,851
-
37,851
(35,787
)
-
(35,787
)
Total Segment EBITDA
41,966
(133
)
42,099
(42,837
)
1,051
(43,888
)
Corporate EBITDA
(5,802
)
-
(5,802
)
(4,326
)
-
(4,326
)
Consolidated Adjusted EBITDA
$
36,164
$
(133
)
$
36,297
$
(47,163
)
$
1,051
$
(48,214
)
Pursuit Adjusted EBITDA: Revenue
$
101,383
$
14,488
$
86,895
$
46,103
$
3,127
$
42,976
Cost of services and products
(117,010
)
(19,133
)
(97,877
)
(72,521
)
(6,400
)
(66,121
)
Segment operating income (loss)
(15,627
)
(4,645
)
(10,982
)
(26,418
)
(3,273
)
(23,145
)
Depreciation
15,648
2,492
13,156
13,003
59
12,944
Amortization
2,495
822
1,673
2,469
647
1,822
Start-up costs (B)
1,079
1,079
-
3,618
3,618
-
Acquisition transaction-related costs
401
-
401
272
-
272
Integration costs
119
119
-
6
-
6
Adjusted EBITDA
$
4,115
$
(133
)
$
4,248
$
(7,050
)
$
1,051
$
(8,101
)
Pursuit Operating margin
-15.4
%
-32.1
%
-12.6
%
-57.3
%
**
-53.9
%
Pursuit Adjusted EBITDA margin
4.1
%
-0.9
%
4.9
%
-15.3
%
33.6
%
-18.9
%
Total GES Adjusted EBITDA: Revenue
$
395,180
$
-
$
395,180
$
44,065
$
-
$
44,065
Cost of services and products
(365,654
)
-
(365,654
)
(90,866
)
-
(90,866
)
Segment operating income (loss)
29,526
-
29,526
(46,801
)
-
(46,801
)
Depreciation
6,142
-
6,142
8,549
-
8,549
Amortization
2,183
-
2,183
2,465
-
2,465
Total GES Adjusted EBITDA
$
37,851
$
-
$
37,851
$
(35,787
)
$
-
$
(35,787
)
Total GES Operating margin
7.5
%
7.5
%
** ** Total GES Adjusted EBITDA margin
9.6
%
9.6
%
-81.2
%
-81.2
%
GES Adjusted EBITDA by Reportable Segment: Spiro
$
16,492
$
16,492
$
(11,599
)
$
(11,599
)
GES Exhibitions
21,359
21,359
(24,188
)
(24,188
)
Total GES
$
37,851
$
-
$
37,851
$
(35,787
)
$
-
$
(35,787
)
Spiro Revenue
$
132,241
$
-
$
132,241
$
24,003
$
-
$
24,003
Spiro Adjusted EBITDA Margin
12.5
%
12.5
%
-48.3
%
-48.3
%
GES Exhibitions Revenue
$
266,431
$
-
$
266,431
$
20,209
$
-
$
20,209
GES Exhibitions Adjusted EBITDA Margin
8.0
%
8.0
%
** ** (A) New Experiences comprises the following
attractions that were opened or acquired after January 1, 2021: Sky
Lagoon (opened May 2021), Golden Skybridge (acquired March 2021 and
opened June 2021), FlyOver Las Vegas (opened September 2021), and
Glacier Raft Company (acquired April 2022) and costs related to the
development of new experiences. (B) Includes costs related to the
development of Pursuit's new FlyOver attractions in Las Vegas,
Chicago, and Toronto, the Sky Lagoon in Iceland, and the Golden
Skybridge and Forest Park Hotel in Canada. (C) Includes
non-capitalizable fees and expenses related to Viad’s credit
facility refinancing efforts.
VIAD CORP AND SUBSIDIARIES
TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED) The following table provides
revenue and Adjusted EBITDA by quarter for 2021, along with
reconciliations of Adjusted EBITDA to the nearest GAAP measure, net
income attributable to Viad.
2021
($ in thousands)
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
Full Year
Viad Consolidated: Net (loss) income attributable to
Viad
$
(43,152
)
$
(42,026
)
$
15,067
$
(22,544
)
$
(92,655
)
Net (loss) income attributable to noncontrolling interest
(1,445
)
(510
)
5,004
(1,363
)
1,686
Net loss attributable to redeemable noncontrolling interest
(494
)
(431
)
(296
)
(545
)
(1,766
)
(Income) loss from discontinued operations
(348
)
62
(248
)
(24
)
(558
)
Net interest expense
5,085
5,565
9,518
8,156
28,324
Income tax benefit
(3,045
)
(2,166
)
5,329
(1,906
)
(1,788
)
Depreciation and amortization
13,177
13,333
13,476
13,764
53,750
Restructuring charges
2,826
787
2,186
267
6,066
Other expense
360
680
466
507
2,013
Pension plan withdrawal
-
57
-
-
57
Start-up costs (A)
1,564
2,054
1,415
(289
)
4,744
Acquisition transaction-related costs
243
88
385
176
892
Integration costs
1
5
-
-
6
Other non-recurring expenses (B)
10
557
2
-
569
Consolidated Adjusted EBITDA
$
(25,218
)
$
(21,945
)
$
52,304
$
(3,801
)
$
1,340
Consolidated Adjusted EBITDA by Business: Pursuit
$
(9,061
)
$
2,011
$
59,593
$
(9,854
)
$
42,689
Total GES
(14,226
)
(21,561
)
(4,226
)
9,649
(30,364
)
Total Segment EBITDA
(23,287
)
(19,550
)
55,367
(205
)
12,325
Corporate EBITDA
(1,931
)
(2,395
)
(3,064
)
(3,596
)
(10,986
)
Consolidated Adjusted EBITDA
$
(25,218
)
$
(21,945
)
$
52,303
$
(3,801
)
$
1,339
Pursuit Adjusted EBITDA: Revenue
$
9,790
$
36,313
$
117,555
$
23,390
$
187,048
Cost of services and products
(28,111
)
(44,410
)
(67,954
)
(41,964
)
(182,439
)
Segment operating income (loss)
(18,321
)
(8,097
)
49,601
(18,574
)
4,609
_
Depreciation
6,457
6,546
6,734
7,623
27,360
Amortization
1,030
1,439
1,462
1,177
5,108
Start-up costs (A)
1,564
2,054
1,415
(289
)
4,744
Acquisition transaction-related costs
208
64
381
209
862
Integration costs
1
5
-
-
6
Adjusted EBITDA
$
(9,061
)
$
2,011
$
59,593
$
(9,854
)
$
42,689
Pursuit Operating margin **
-22.3
%
42.2
%
-79.4
%
2.5
%
Pursuit Adjusted EBITDA margin
-92.6
%
5.5
%
50.7
%
-42.1
%
22.8
%
Total GES Adjusted EBITDA: Revenue
$
19,145
$
24,920
$
116,044
$
160,183
$
320,292
Cost of services and products
(39,049
)
(51,817
)
(125,544
)
(155,494
)
(371,904
)
Segment operating income (loss)
(19,904
)
(26,897
)
(9,500
)
4,689
(51,612
)
Depreciation
4,433
4,116
4,024
3,746
16,319
Amortization
1,245
1,220
1,250
1,214
4,929
Total GES Adjusted EBITDA
$
(14,226
)
$
(21,561
)
$
(4,226
)
$
9,649
$
(30,364
)
Total GES Operating margin ** **
-8.2
%
2.9
%
-16.1
%
Total GES Adjusted EBITDA margin
-74.3
%
-86.5
%
-3.6
%
6.0
%
-9.5
%
GES Adjusted EBITDA by Reportable Segment: Spiro
$
(5,542
)
$
(6,057
)
$
890
$
6,430
$
(4,279
)
GES Exhibitions
(8,684
)
(15,504
)
(5,116
)
3,219
(26,085
)
Total GES
$
(14,226
)
$
(21,561
)
$
(4,226
)
$
9,649
$
(30,364
)
Spiro Revenue
$
12,059
$
11,944
$
37,866
$
54,718
$
116,587
Spiro Adjusted EBITDA Margin
-46.0
%
-50.7
%
2.4
%
11.8
%
-3.7
%
GES Exhibitions Revenue
$
7,152
$
13,057
$
81,129
$
108,152
$
209,490
GES Exhibitions Adjusted EBITDA Margin ** **
-6.3
%
3.0
%
-12.5
%
(A) Includes costs related to the development of
Pursuit's new FlyOver attractions in Las Vegas, Chicago, and
Toronto, the Sky Lagoon in Iceland, the Golden Skybridge and Forest
Park Hotel in Canada. (B) Includes non-capitalizable fees and
expenses related to Viad’s credit facility refinancing efforts.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220804005446/en/
Carrie Long or Michelle Porhola Investor Relations (602)
207-2681 ir@viad.com
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