Viad Corp Reports 2019 Third Quarter Results

Pursuit Delivered Revenue Growth of 20% through Acquisitions and Strong Organic Performance

GES Delivered Underlying Business Growth to Partially Offset the Impact of Show Rotation

PHOENIX--()--Viad Corp (NYSE: VVI) today announced third quarter 2019 results that reflect continued business growth and contributions from the Mountain Park Lodges acquisition, largely offset by expected negative show rotation from non-annual events that occurred during the 2018 third quarter.

Q3

Q3

y-o-y
Change

2019

2018

$ in millions, except per share data

 

Revenue

$362.5

$358.2

1.2%

Organic Revenue*

352.3

358.2

-1.6%

 

Net Income Attributable to Viad

$31.4

$37.4

-16.0%

Income Before Other Items*

31.7

35.0

-9.6%

 

 

 

 

Net Income Attributable to Viad per Share

$1.53

$1.83

-16.4%

Income Before Other Items per Share*

1.56

1.72

-9.3%

 

Adjusted Segment Operating Income*

$56.0

$57.0

-1.7%

Adjusted Segment EBITDA*

72.3

73.1

-1.1%

  • Revenue of $362.5 million increased 1.2% ($4.3 million) year-over-year, and decreased 1.6% ($5.8 million) on an organic basis (which excludes the impact of acquisitions and exchange rate variances).
    • The organic revenue decline primarily reflects negative show rotation of $38 million, partially offset by continued growth at both Pursuit and GES.
    • The acquisitions of Mountain Park Lodges and the Belton Chalet contributed revenue of $13.1 million.
    • Exchange rate variances had an unfavorable impact on revenue of $2.9 million.
  • The expected declines in adjusted segment operating income and adjusted segment EBITDA were primarily driven by higher performance-based incentives versus the 2018 third quarter.
  • Income before other items decreased compared to the prior year quarter primarily due to an increase in income attributable to noncontrolling interests, lower adjusted segment operating income, and higher interest expense. The GAAP-basis net income attributable to Viad also included higher restructuring charges related to GES simplification actions.

Steve Moster, president and chief executive officer, commented, “Our third quarter results reflect solid performance at both GES and Pursuit. We continue to deliver on key strategic goals that are driving profitable growth and strengthening our value proposition for our clients and guests. GES continues to drive strong growth in revenue from corporate clients and Pursuit continues to deliver strong returns from our investments to scale and enhance our guest experiences.”

GES Results

Moster said, “GES continues to make great progress driving growth within the corporate market, and successfully delivered events for some notable new clients during the third quarter. The team’s efforts to increase GES’ share of the corporate event market and relentless focus on business development helped to substantially offset the impact of show rotation during the third quarter. With the exception of some continued softness in the retail sector, we continue to experience growth in the events we produce and solid spending by our corporate clients.”

Q3

Q3

y-o-y
Change

2019

2018

$ in millions

 

Revenue

$227.4

$246.1

-7.6%

North America Organic Revenue*

192.1

200.9

-4.3%

EMEA Organic Revenue*

43.3

47.6

-9.2%

 

Adjusted Segment Operating Income (Loss)*

$(11.6)

$1.2

**

Adjusted Segment Operating Margin*

-5.1%

0.5%

-560 bps

 

Adjusted Segment EBITDA*

$(2.8)

$10.6

**

Adjusted Segment EBITDA Margin*

-1.2%

4.3%

-550 bps

 

Key Performance Indicators:

U.S. Base Same-Show Revenue Change(1)

-0.6%

Show Rotation Revenue Change – North America (approx.)(2)

$(29)

Show Rotation Revenue Change – EMEA (approx.)(2)

$(9)

 

**Change is greater than +/- 100 percent.

(1)

Base same-shows are defined as shows produced by GES out of the same U.S. city during the same quarter in both the current year and prior year. Base same-shows represented 24.9% of GES North America’s organic revenue during the 2019 third quarter.

(2)

Show rotation refers to shows that take place once every two, three or four years, as well as annual shows that change quarters from one year to the next.

  • GES revenue of $227.4 million decreased 7.6% ($18.7 million) year-over-year. On an organic basis, which excludes the impact of exchange rate variances, revenue decreased 6.7% ($16.5 million) due to negative show rotation of $38 million.
    • North America organic revenue decreased 4.3% ($8.7 million) primarily due to negative show rotation of approximately $29 million, which was substantially offset by continued growth from corporate clients and other new client wins. Our U.S. base same-show revenue decline was driven by one retail show with reduced square footage.
    • EMEA organic revenue decreased 9.2% ($4.4 million) primarily due to negative show rotation of approximately $9 million, partially offset by new client wins and growth from the underlying business.
  • GES adjusted segment operating loss of $11.6 million* increased $12.8 million year-over-year, and $12.9 million on an organic basis.
    • North America organic adjusted segment operating loss of $8.6 million* increased by $10.0 million primarily due to accruals for performance-based incentives versus reversals in the 2018 quarter and negative show rotation.
    • EMEA organic adjusted segment operating loss of $3.2 million* increased $3.0 million primarily due to accruals for performance-based incentives versus reversals in the 2018 quarter and negative show rotation.
  • Exchange rate variances had a negative impact of $2.2 million on revenue and a positive impact of $0.1 million on adjusted segment operating loss.

Pursuit Results

Moster said, “Pursuit drove revenue growth of 20 percent during the quarter through successful execution of its Refresh, Build, Buy strategy. We delivered strong results from the recently acquired Mountain Park Lodges properties, as well as on an organic basis. Our newly opened West Glacier RV Park had a solid first season and our FlyOver Iceland attraction, which opened at the end of August, is receiving great guest reviews. Additionally, we continued to drive strong same-store growth within our attractions and hospitality properties, reflecting our emphasis on delivering exceptional guest experiences and revenue management efforts.”

Q3

 

Q3

 

y-o-y
Change

2019

 

2018

 

$ in millions

 

Revenue

$135.0

$112.1

20.5%

Organic Revenue*

122.7

112.1

9.5%

 

Adjusted Segment Operating Income*

$67.6

$55.8

21.2%

Adjusted Segment Operating Margin*

50.0%

49.8%

20 bps

 

Adjusted Segment EBITDA*

$75.1

$62.5

20.2%

Adjusted Segment EBITDA Margin*

55.6%

55.8%

-20 bps

 

Key Performance Indicators:

Same-Store Effective Ticket Price(1)

$38

$36

5.6%

Same-Store Revenue per Attraction Visitor(1)

$50

$45

11.1%

Same-Store Attraction Visitors(1)

1,274,808

1,333,204

-4.4%

Same-Store RevPAR(2)

$214

$198

8.1%

Same-Store Room Nights Available(2)

123,863

119,932

3.3%

(1)

Same-store effective ticket price is calculated as revenue from the sale of attraction tickets divided by the total number of tickets sold for all comparable Pursuit attractions, expressed on a constant currency basis. Same-store revenue per attraction visitor is a similar measure but also takes into consideration ancillary revenue derived from food and beverage and retail offerings at the comparable attractions. Comparable attractions are defined as those operated by Pursuit for the entirety of both periods. Accordingly, the measures shown above do not include the FlyOver Iceland attraction (opened August 2019).

(2)

Same-store RevPAR is calculated as total rooms revenue divided by the total number of room nights available for all comparable Pursuit properties during the periods presented, expressed on a constant currency basis. Comparable properties are defined as those operated by Pursuit for the entirety of both periods. Accordingly, the measures shown above do not include the Mountain Park Lodges (acquired June 2019), the Belton Chalet (acquired May 2019), and the West Glacier RV Park & Cabins (opened July 2019).

  • Pursuit revenue of $135.0 million increased 20.5% ($23.0 million) year-over-year. On an organic basis, which excludes the impact of acquisitions and exchange rate variances, revenue increased 9.5% ($10.6 million) primarily due to the opening of several new build projects, as well as stronger performance from recently refreshed experiences and our revenue management efforts.
    • Pursuit drove continued revenue growth from its leading attractions through higher ancillary revenue and dynamic pricing, which resulted in strong same-store revenue per attraction visitor growth of 11.1%. The decrease in same-store attractions visitors was due to the impact of softer visitation from select long-haul markets at certain attractions.
    • Pursuit increased RevPAR by 8.1% year-over-year primarily due to higher ADR driven by our refreshed properties, including the recently renovated Glacier View Lodge and Mount Royal Hotel, and our efforts to maximize revenue across all of our properties.
  • Pursuit adjusted segment operating income of $67.6 million* increased $11.8 million year-over-year. Organic adjusted segment operating income of $61.8 million* increased $6.1 million primarily due to the increase in revenue.
  • Mountain Park Lodges (acquired on June 8, 2019) and the Belton Chalet (acquired on May 21, 2019) contributed $13.1 million in revenue and $7.4 million in adjusted segment EBITDA ($4.7 million of EBITDA attributable to Viad shareholders).
  • Exchange rate variances had a negative impact of $0.7 million on revenue and $0.4 million on adjusted segment operating income.

Cash Flow / Capital Structure

  • Our cash flow from operations was $61.6 million for the 2019 third quarter.
  • Our capital expenditures for the quarter totaled $14.4 million, comprising $8.5 million for Pursuit and $5.8 million for GES.
  • Our return of capital totaled $2.0 million for the quarter (which represented quarterly dividends of $0.10 per share). We had 600,067 shares remaining under our current repurchase authorization at September 30, 2019.
  • Our debt payments (net) totaled $14.9 million for the quarter.
  • Our cash and cash equivalents were $56.6 million, debt was $326.2 million, and our debt-to-capital ratio was 38.0% at September 30, 2019.

Business Outlook

2019 Full Year Guidance

Moster said, “We have updated our guidance to reflect a reduced outlook for fourth quarter revenue at GES based on our current sales pipelines, as well as the lower than previously expected third quarter growth at Pursuit, which was primarily due to softer group visitation and the delayed completion and ramp up of certain build and refresh projects. The GES team is aggressively working to secure additional business and manage costs. And, with all of our planned new and refreshed experiences for 2019 fully operational, the Pursuit team is focused on delighting our guests for maximum returns.”

  • We expect consolidated revenue to increase at a mid-single digit rate from 2018 full year revenue, driven by growth at both GES and Pursuit.
  • We expect consolidated adjusted segment EBITDA to be in the range of $153.5 million to $157.5 million, as compared to $146.3 million* in 2018.
  • The outlook for our business units is as follows:

 

GES

 

Pursuit

$ in millions

 

Revenue

Up low-single digits
(from $1,111 in 2018)

 

Up 20% to 21.5%
(from $185 in 2018)

Adjusted Segment EBITDA

$71.5 to $74.5
(vs. $77.7* in 2018)

 

$81.5 to $83.5
(vs. $68.6* in 2018)

Depreciation & Amortization

$35 to $37

 

$23 to $24

Adjusted Segment Operating Income

$35.5 to $38.5
(vs. $39.8* in 2018)

 

$58 to $60
(vs. $49.9* in 2018)

Capital Expenditures

 

 

$27 to $30
(inclusive of about $10 for
growth projects)

 

$55 to $59
(inclusive of about $42
for growth projects,
including FlyOver Las Vegas)

  • Our guidance assumes that exchange rates during the remainder of 2019 will approximate $0.76 U.S. Dollars per Canadian Dollar and $1.23 U.S. Dollars per British Pound. As compared to 2018, we expect exchange rate variances to impact 2019 full year results as follows:

 

Viad Total

GES

Pursuit

 

$ in millions, except per share data

Revenue

$ (15.0)

 

$(13.0)

 

$(2.0)

Adjusted Segment Operating Income

$ (0.5)

 

$ (0.5)

 

-

Income per Share Before Other Items

$(0.02)

 

 

 

 

  • We expect GES show rotation to have a net negative impact on full year revenue of about $15 million to $20 million versus 2018. Show rotation refers to shows that occur less frequently than annually, as well as annual shows that shift quarters from one year to the next.

 

Q1 Act.

Q2 Act.

Q3 Act.

Q4 Est.

FY Est.

Show Rotation Revenue ($ in millions)

$(2)

$19

$(38)

$5

$(15) - $(20)

  • We expect GES U.S. base same-show revenue to increase at a low single digit rate.
  • We expect Pursuit’s 2019 growth to be fueled primarily by investments to support our Refresh, Build, Buy strategy, which are expected to contribute incremental revenue of approximately $29 million to $31 million during 2019, inclusive of $19 million to $21 million from the Mountain Park Lodges and Belton Chalet acquisitions. Additionally, we expect to realize mid-single digit revenue growth across the rest of our attractions and hospitality assets.
  • We expect start-up costs related to the development of Pursuit’s FlyOver attractions to approximate $2.5 million during 2019. These costs are not included in the adjusted segment EBITDA or adjusted segment operating income guidance ranges above.
  • We expect corporate activities expense to be in the range of $11 million to $12 million, including $1.3 million of year-to-date acquisition transaction-related costs.
  • We expect our effective tax rate on income before other items to be 29% to 30%.

2019 Fourth Quarter Guidance

 

 

 

2019 Guidance

 

2018

 

Low End

 

High End

 

FX Impact(1)

 

$ in millions, except per share data

Revenue:

 

 

 

 

 

 

 

 

 

GES

$281.8

 

$ 285

 

to

 

$ 300

 

$ (3.0)

Pursuit

15.2

 

21

 

to

 

24

 

-

Adjusted Segment Operating Income (Loss):

 

 

 

 

 

 

 

 

 

GES

$ 8.9*

 

$10

 

to

 

$13

 

$ (0.5)

Pursuit

(4.7)*

 

(9)

 

to

 

(7)

 

-

 

 

 

 

 

 

 

 

 

 

Loss per Share Before Other Items

$(0.09)*

 

$ (0.22)

 

to

 

$ (0.07)

 

$ (0.01)

(1)

FX Impact represents the expected effect of year-over-year changes in exchange rates that is incorporated in the low end and high end guidance ranges presented.

  • We expect GES fourth quarter results to increase primarily due to positive show rotation and continued new business wins.
  • We expect the Mountain Park Lodges and Belton Chalet acquisitions to contribute fourth quarter revenue of $3 million to $5 million. We expect Pursuit fourth quarter operating results to decrease primarily due to additional costs and investments to support continued expansion of the business, including an increase of about $3 million in depreciation and amortization expense.

Conference Call and Web Cast

We will hold a conference call with investors and analysts for a review of third quarter 2019 results on Thursday, October 24, 2019 at 5:00 p.m. (ET). To join the live conference, call (877) 917-8933, passcode “Viad”, or access the webcast through Viad’s Web site at www.viad.com. A replay will be available for a limited time at (888) 667-5782 or (402) 220-6425 (no passcode is required), or visit the Viad Web site and link to a replay of the webcast.

About Viad

Viad (NYSE: VVI) generates revenue and shareholder value through two businesses: GES and Pursuit. GES is a global, full-service live events company offering a comprehensive range of services to the world's leading brands and event organizers. Pursuit is a collection of inspiring and unforgettable travel experiences in Alaska, Montana, the Canadian Rockies, Vancouver, Reykjavik, Las Vegas (expected opening in 2021), and Toronto (expected opening in 2022) that includes attractions, lodges and hotels, and sightseeing tours that connect guests with iconic places. Our business strategy focuses on providing superior experiential services to our customers and sustainable returns on invested capital to our shareholders. Viad is an S&P SmallCap 600 company. 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:

  • our ability to successfully integrate and achieve established financial and strategic goals from acquisitions;
  • fluctuations in general economic conditions;
  • our dependence on large exhibition event clients;
  • the importance of key members of our account teams to our business relationships;
  • the competitive nature of the industries in which we operate;
  • travel industry disruptions;
  • unanticipated delays and cost overruns of our capital projects, and our ability to achieve established financial and strategic goals of such projects;
  • seasonality of our businesses;
  • transportation disruptions and increases in transportation costs;
  • natural disasters and other catastrophic events;
  • the impact of recent U.S. tax legislation;
  • our multi-employer pension plan funding obligations;
  • our exposure to labor cost increases and work stoppages related to unionized employees;
  • liabilities relating to prior and discontinued operations;
  • adverse effects of show rotation on our periodic results and operating margins;
  • our exposure to currency exchange rate fluctuations;
  • our exposure to cybersecurity attacks and threats;
  • 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;
  • the effects of the United Kingdom’s exit from the European Union; and
  • the effects of changes in the U.S. trade policy.

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

We have provided the following forward-looking non-GAAP financial measures: Adjusted Segment EBITDA, Adjusted Segment Operating Income and Income Before Other Items. We do not provide quantitative reconciliations of these forward-looking non-GAAP financial measures to their most directly comparable GAAP financial measures because, due to variability and difficulty in developing accurate projections and/or certain information not being ascertainable or accessible, not all of the information necessary to do so is available to us without unreasonable effort. Consequently, any attempt to disclose such reconciliations would imply a degree of precision that could be confusing or misleading to investors. It is probable that our forward-looking non-GAAP financial measures may be materially different from the corresponding GAAP financial measures.

* 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.

VIAD CORP AND SUBSIDIARIES
TABLE ONE - QUARTERLY RESULTS
(UNAUDITED)
 
 

Three months ended September 30,

 

Nine months ended September 30,

($ in thousands, except per share data)

2019

 

2018

 

$ Change

 

% Change

 

2019

 

2018

 

$ Change

 

% Change

Revenue:
GES:
North America

$

191,983

 

$

200,855

 

$

(8,872

)

-4.4

%

$

698,906

 

$

683,810

 

$

15,096

 

2.2

%

EMEA

 

41,186

 

 

47,634

 

 

(6,448

)

-13.5

%

 

165,067

 

 

157,216

 

 

7,851

 

5.0

%

Intersegment eliminations

 

(5,724

)

 

(2,379

)

 

(3,345

)

**

 

(14,731

)

 

(11,888

)

 

(2,843

)

-23.9

%

Total GES

 

227,445

 

 

246,110

 

 

(18,665

)

-7.6

%

 

849,242

 

 

829,138

 

 

20,104

 

2.4

%

Pursuit

 

135,043

 

 

112,053

 

 

22,990

 

20.5

%

 

201,119

 

 

170,130

 

 

30,989

 

18.2

%

Total revenue

$

362,488

 

$

358,163

 

$

4,325

 

1.2

%

$

1,050,361

 

$

999,268

 

$

51,093

 

5.1

%

 
Segment operating income (loss):
GES:
North America

$

(8,562

)

$

1,367

 

$

(9,929

)

**

$

22,635

 

$

25,055

 

$

(2,420

)

-9.7

%

EMEA

 

(3,024

)

 

(207

)

 

(2,817

)

**

 

2,775

 

 

5,690

 

 

(2,915

)

-51.2

%

Total GES

 

(11,586

)

 

1,160

 

 

(12,746

)

**

 

25,410

 

 

30,745

 

 

(5,335

)

-17.4

%

Pursuit

 

66,392

 

 

55,408

 

 

10,984

 

19.8

%

 

64,710

 

 

53,770

 

 

10,940

 

20.3

%

Segment operating income

 

54,806

 

 

56,568

 

 

(1,762

)

-3.1

%

 

90,120

 

 

84,515

 

 

5,605

 

6.6

%

Corporate eliminations

 

16

 

 

18

 

 

(2

)

-11.1

%

 

49

 

 

51

 

 

(2

)

-3.9

%

Corporate activities (Note A)

 

(2,680

)

 

(3,777

)

 

1,097

 

29.0

%

 

(7,795

)

 

(8,529

)

 

734

 

8.6

%

Restructuring charges (Note B)

 

(1,702

)

 

(175

)

 

(1,527

)

**

 

(6,845

)

 

(999

)

 

(5,846

)

**
Impairment recoveries

 

-

 

 

-

 

 

-

 

**

 

-

 

 

35

 

 

(35

)

-100.0

%

Legal settlement (Note C)

 

-

 

 

-

 

 

-

 

**

 

(8,500

)

 

-

 

 

(8,500

)

**
Pension plan withdrawal (Note D)

 

-

 

 

-

 

 

-

 

**

 

(15,508

)

 

-

 

 

(15,508

)

**
Other expense

 

(281

)

 

(527

)

 

246

 

46.7

%

 

(1,192

)

 

(1,308

)

 

116

 

8.9

%

Net interest expense (Note E)

 

(3,661

)

 

(2,507

)

 

(1,154

)

-46.0

%

 

(9,352

)

 

(6,793

)

 

(2,559

)

-37.7

%

Income from continuing operations before
income taxes

 

46,498

 

 

49,600

 

 

(3,102

)

-6.3

%

 

40,977

 

 

66,972

 

 

(25,995

)

-38.8

%

Income tax expense (Note F)

 

(11,891

)

 

(10,806

)

 

(1,085

)

-10.0

%

 

(10,861

)

 

(15,282

)

 

4,421

 

28.9

%

Income from continuing operations

 

34,607

 

 

38,794

 

 

(4,187

)

-10.8

%

 

30,116

 

 

51,690

 

 

(21,574

)

-41.7

%

Income (loss) from discontinued operations (Note G)

 

(141

)

 

(246

)

 

105

 

42.7

%

 

32

 

 

403

 

 

(371

)

-92.1

%

Net income

 

34,466

 

 

38,548

 

 

(4,082

)

-10.6

%

 

30,148

 

 

52,093

 

 

(21,945

)

-42.1

%

Net income attributable to noncontrolling interest

 

(3,418

)

 

(1,287

)

 

(2,131

)

**

 

(3,329

)

 

(890

)

 

(2,439

)

**
Net loss attributable to redeemable noncontrolling interest

 

368

 

 

128

 

 

240

 

**

 

644

 

 

289

 

 

355

 

**
Net income attributable to Viad

$

31,416

 

$

37,389

 

$

(5,973

)

-16.0

%

$

27,463

 

$

51,492

 

$

(24,029

)

-46.7

%

 
Amounts Attributable to Viad Common Stockholders:
Income from continuing operations

$

31,557

 

$

37,635

 

$

(6,078

)

-16.1

%

$

27,431

 

$

51,089

 

$

(23,658

)

-46.3

%

Income (loss) from discontinued operations (Note G)

 

(141

)

 

(246

)

 

105

 

42.7

%

 

32

 

 

403

 

 

(371

)

-92.1

%

Net income

$

31,416

 

$

37,389

 

$

(5,973

)

-16.0

%

$

27,463

 

$

51,492

 

$

(24,029

)

-46.7

%

 
Diluted income per common share:
Income from continuing operations
attributable to Viad common shareholders

$

1.54

 

$

1.84

 

$

(0.30

)

-16.3

%

$

1.33

 

$

2.49

 

$

(1.16

)

-46.6

%

Income (loss) from discontinued operations
attributable to Viad common shareholders

 

(0.01

)

 

(0.01

)

 

-

 

0.0

%

 

-

 

 

0.02

 

 

(0.02

)

-100.0

%

Net income attributable to Viad common
shareholders

$

1.53

 

$

1.83

 

$

(0.30

)

-16.4

%

$

1.33

 

$

2.51

 

$

(1.18

)

-47.0

%

 
Basic income per common share:
Income from continuing operations
attributable to Viad common shareholders

$

1.54

 

$

1.85

 

$

(0.31

)

-16.8

%

$

1.33

 

$

2.50

 

$

(1.17

)

-46.8

%

Income (loss) from discontinued operations
attributable to Viad common shareholders

 

(0.01

)

 

(0.01

)

 

-

 

0.0

%

 

-

 

 

0.02

 

 

(0.02

)

-100.0

%

Net income attributable to Viad common
shareholders

$

1.53

 

$

1.84

 

$

(0.31

)

-16.8

%

$

1.33

 

$

2.52

 

$

(1.19

)

-47.2

%

 
Common shares treated as outstanding for
income per share calculations:
Weighted-average outstanding common shares

 

20,168

 

 

20,145

 

 

23

 

0.1

%

 

20,129

 

 

20,187

 

 

(58

)

-0.3

%

 
Weighted-average outstanding and potentially
dilutive common shares

 

20,311

 

 

20,387

 

 

(76

)

-0.4

%

 

20,267

 

 

20,427

 

 

(160

)

-0.8

%

 
** Change is greater than +/- 100 percent

VIAD CORP AND SUBSIDIARIES

TABLE ONE - NOTES TO QUARTERLY RESULTS

(UNAUDITED)

 

(A)

Corporate Activities — The decrease in corporate activities expense during the three months ended September 30, 2019 relative to 2018 was primarily due to lower performance-based compensation expense. The decrease in corporate activities expense during the nine months ended September 30, 2019 relative to 2018 was primarily due to a gain on sale of corporate fixed assets, offset in part by higher acquisition transaction-related costs in 2019.

 

(B)

Restructuring Charges — During the three and nine months ended September 30, 2019, we recorded restructuring charges primarily related to the elimination of certain positions and facility consolidations at GES. During the three months ended September 30, 2018, we recorded restructuring charges primarily related to the elimination of certain positions at GES. During the nine months ended September 30, 2018, we recorded restructuring charges primarily related to the elimination of certain positions at GES and Pursuit.

 

(C)

Legal Settlement — During the nine months ended September 30, 2019, we recorded a charge related to a legal settlement at GES involving a former industry contractor.

 

(D)

Pension Plan Withdrawal — During the nine months ended September 30, 2019, we finalized the terms of a new collective-bargaining agreement with a certain union. The terms include a withdrawal from the under-funded Central States Pension Plan. Accordingly, we recorded a charge of $15.5 million, which represents the estimated present value of future contributions we will be required to make to the plan as a result of this partial withdrawal from the plan.

 

(E)

Net Interest Expense — The increase in net interest expense for the three and nine months ended September 30, 2019 relative to 2018 was primarily due to higher debt balances and interest rates in 2019.

 

(F)

Income Taxes — Our effective income tax rates for the three and nine months ended September 30, 2019 were 26% and 27%, respectively, as compared to 22% and 23% for the three and nine months ended September 30, 2018, respectively. The increases in the effective rates were primarily related to increased non-deductible expenses and lower domestic income, which is taxed at lower rates. In 2019, the rates were favorably impacted by the re-measurement of our Alberta deferred tax assets due to a rate reduction in the third quarter. In 2018, the rates were favorably impacted by the benefit taken related to reductions in our estimated repatriation tax.

 

(G)

Income (Loss) from Discontinued Operations — Loss from discontinued operations for the three months ended September 30, 2019 and 2018 was primarily related to legal expenses related to previously sold operations. Income from discontinued operations for the nine months ended September 30, 2019 and 2018 was primarily related to a favorable legal settlement related to previously sold operations.

Three months ended September 30,

 

Nine months ended September 30,

($ in thousands, except per share data)

2019

 

2018

 

$ Change

 

% Change

 

2019

 

2018

 

$ Change

 

% Change

 
Net income attributable to Viad

$

31,416

 

$

37,389

 

$

(5,973

)

-16.0

%

$

27,463

 

$

51,492

 

$

(24,029

)

-46.7

%

Less: Allocation to nonvested shares

 

(226

)

 

(338

)

 

112

 

33.1

%

 

(196

)

 

(493

)

 

297

 

60.2

%

Adjustment to the redemption value of redeemable
noncontrolling interest

 

(264

)

 

(84

)

 

(180

)

**

 

(530

)

 

(174

)

 

(356

)

**
Net income allocated to Viad common
shareholders

$

30,926

 

$

36,967

 

$

(6,041

)

-16.3

%

$

26,737

 

$

50,825

 

$

(24,088

)

-47.4

%

 
Weighted-average outstanding common shares

 

20,168

 

 

20,145

 

 

23

 

0.1

%

 

20,129

 

 

20,187

 

 

(58

)

-0.3

%

 
Basic income per common share attributable
to Viad common shareholders

$

1.53

 

$

1.84

 

$

(0.31

)

-16.8

%

$

1.33

 

$

2.52

 

$

(1.19

)

-47.2

%

 
** Change is greater than +/- 100 percent
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", "Adjusted Segment EBITDA" 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 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 and Adjusted Segment EBITDA provide 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 Segment 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 September 30,

 

Nine months ended September 30,

($ in thousands)

2019

 

2018

 

$ Change

 

% Change

 

2019

 

2018

 

$ Change

 

% Change

Income before other items:
Net income attributable to Viad

$

31,416

 

$

37,389

 

$

(5,973

)

-16.0

%

$

27,463

 

$

51,492

 

$

(24,029

)

-46.7

%

(Income) loss from discontinued operations attributable to Viad

 

141

 

 

246

 

 

(105

)

-42.7

%

 

(32

)

 

(403

)

 

371

 

92.1

%

Income from continuing operations attributable to Viad

 

31,557

 

 

37,635

 

 

(6,078

)

-16.1

%

 

27,431

 

 

51,089

 

 

(23,658

)

-46.3

%

Restructuring charges, pre-tax

 

1,702

 

 

175

 

 

1,527

 

**

 

6,845

 

 

999

 

 

5,846

 

**
Impairment recoveries, pre-tax

 

-

 

 

-

 

 

-

 

**

 

-

 

 

(35

)

 

35

 

-100.0

%

Legal settlement, pre-tax

 

-

 

 

-

 

 

-

 

**

 

8,500

 

 

-

 

 

8,500

 

**
Pension plan withdrawal, pre-tax

 

-

 

 

-

 

 

-

 

**

 

15,508

 

 

-

 

 

15,508

 

**
Acquisition-related costs and other non-recurring expenses, pre-tax (Note A)

 

1,493

 

 

649

 

 

844

 

**

 

3,511

 

 

1,470

 

 

2,041

 

**
Tax expense on above items

 

(724

)

 

(188

)

 

(536

)

**

 

(8,519

)

 

(552

)

 

(7,967

)

**
Adjustment related to Tax Reform

 

-

 

 

(3,109

)

 

3,109

 

-100.0

%

 

-

 

 

(3,109

)

 

3,109

 

-100.0

%

Favorable tax matters

 

(2,105

)

 

-

 

 

(2,105

)

**

 

(2,105

)

 

-

 

 

(2,105

)

**
Net loss attributable to FlyOver Iceland noncontrolling interest

 

(242

)

 

(128

)

 

(114

)

-89.1

%

 

(518

)

 

(289

)

 

(229

)

-79.2

%

Income before other items

$

31,681

 

$

35,034

 

$

(3,353

)

-9.6

%

$

50,653

 

$

49,573

 

$

1,080

 

2.2

%

 
(per diluted share)
Income before other items:
Net income attributable to Viad

$

1.53

 

$

1.83

 

$

(0.30

)

-16.4

%

$

1.33

 

$

2.51

 

$

(1.18

)

-47.0

%

(Income) loss from discontinued operations attributable to Viad

 

0.01

 

 

0.01

 

 

-

 

0.0

%

 

-

 

 

(0.02

)

 

0.02

 

-100.0

%

Income from continuing operations attributable to Viad

 

1.54

 

 

1.84

 

 

(0.30

)

-16.3

%

 

1.33

 

 

2.49

 

 

(1.16

)

-46.6

%

Restructuring charges, pre-tax

 

0.08

 

 

0.01

 

 

0.07

 

**

 

0.34

 

 

0.05

 

 

0.29

 

**
Impairment recoveries, pre-tax

 

-

 

 

-

 

 

-

 

**

 

-

 

 

-

 

 

-

 

**
Legal settlement, pre-tax

 

-

 

 

-

 

 

-

 

**

 

0.42

 

 

-

 

 

0.42

 

**
Pension plan withdrawal, pre-tax

 

-

 

 

-

 

 

-

 

**

 

0.76

 

 

-

 

 

0.76

 

**
Acquisition-related costs and other non-recurring expenses, pre-tax (Note A)

 

0.07

 

 

0.03

 

 

0.04

 

**

 

0.17

 

 

0.07

 

 

0.10

 

**
Tax expense on above items

 

(0.02

)

 

-

 

 

(0.02

)

**

 

(0.39

)

 

(0.02

)

 

(0.37

)

**
Adjustment related to Tax Reform

 

-

 

 

(0.15

)

 

0.15

 

-100.0

%

 

-

 

 

(0.15

)

 

0.15

 

-100.0

%

Favorable tax matters

 

(0.10

)

 

-

 

 

(0.10

)

**

 

(0.10

)

 

-

 

 

(0.10

)

**
Net loss attributable to FlyOver Iceland noncontrolling interest

 

(0.01

)

 

(0.01

)

 

-

 

0.0

%

 

(0.03

)

 

(0.01

)

 

(0.02

)

**
Income before other items

$

1.56

 

$

1.72

 

$

(0.16

)

-9.3

%

$

2.50

 

$

2.43

 

$

0.07

 

2.9

%

 
($ in thousands)
Adjusted EBITDA:
Net income attributable to Viad

$

31,416

 

$

37,389

 

$

(5,973

)

-16.0

%

$

27,463

 

$

51,492

 

$

(24,029

)

-46.7

%

(Income) loss from discontinued operations attributable to Viad

 

141

 

 

246

 

 

(105

)

-42.7

%

 

(32

)

 

(403

)

 

371

 

92.1

%

Impairment recoveries, pre-tax

 

-

 

 

-

 

 

-

 

**

 

-

 

 

(35

)

 

35

 

-100.0

%

Interest expense

 

3,740

 

 

2,608

 

 

1,132

 

43.4

%

9,612

7,031

2,581

36.7

%

Income tax expense

 

11,891

 

 

10,806

 

 

1,085

 

10.0

%

 

10,861

 

 

15,282

 

 

(4,421

)

-28.9

%

Depreciation and amortization

 

16,346

 

 

16,186

 

 

160

 

1.0

%

 

44,061

 

 

44,364

 

 

(303

)

-0.7

%

Other noncontrolling interest

 

(1,819

)

 

(533

)

 

(1,286

)

**

 

(2,086

)

 

(515

)

 

(1,571

)

**
Adjusted EBITDA

$

61,715

 

$

66,702

 

$

(4,987

)

-7.5

%

$

89,879

 

$

117,216

 

$

(27,337

)

-23.3

%

 
 
(A) Acquisition-related costs and other non-recurring expenses include:

Three months ended September 30,

 

Nine months ended September 30,

2019

 

2018

 

$ Change

 

% Change

 

2019

 

2018

 

$ Change

 

% Change

Acquisition integration costs - GES1

$

-

 

$

25

 

$

(25

)

-100.0

%

$

-

 

$

155

 

$

(155

)

-100.0

%

Acquisition integration costs - Pursuit1

 

235

 

 

-

 

 

235

 

**

 

268

 

 

-

 

 

268

 

**
Acquisition transaction-related costs - Pursuit1

 

83

 

 

29

 

 

54

 

**

 

354

 

 

97

 

 

257

 

**
Acquisition transaction-related costs - Corporate2

 

297

 

 

244

 

 

53

 

21.7

%

 

1,347

 

 

430

 

 

917

 

**
FlyOver start-up costs1, 3

 

878

 

 

351

 

 

527

 

**

 

1,542

 

 

788

 

 

754

 

95.7

%

Acquisition-related and other non-recurring expenses, pre-tax

$

1,493

 

$

649

 

$

844

 

**

$

3,511

 

$

1,470

 

$

2,041

 

**
1 Included in segment operating income (loss)
2 Included in corporate activities
3 Includes costs related to the development of Pursuit's new FlyOver attractions in Iceland and Las Vegas
** Change is greater than +/- 100 percent

VIAD CORP AND SUBSIDIARIES

TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)

(UNAUDITED)

 
Organic - The term "organic" is used within this document to refer to results without the impact of exchange rate variances and acquisitions, if any, until such acquisitions are included in the entirety of both comparable periods. The impact of exchange rate variances (or "FX Impact") is calculated as the difference between current period activity translated at the current period's exchange rates and the comparable prior period's exchange rates. Management believes that the presentation of "organic" results permits investors to better understand Viad's performance without the effects of exchange rate variances or acquisitions.

Three months ended September 30, 2019

 

Three months ended September 30, 2018

($ in thousands)

As Reported

 

Acquisitions
(Note A)

 

FX Impact

 

Organic

 

As Reported

 

Acquisitions
(Note A)

 

Organic

 
Viad Consolidated:
Revenue

$

362,488

 

$

13,050

 

$

(2,901

)

$

352,339

 

$

358,163

 

$

-

$

358,163

 

 
Net income attributable to Viad

$

31,416

 

$

37,389

 

Net income attributable to noncontrolling interest

 

3,418

 

 

1,287

 

Net loss attributable to redeemable noncontrolling interest

 

(368

)

 

(128

)

Loss from discontinued operations

 

141

 

 

246

 

Income tax expense

 

11,891

 

 

10,806

 

Net interest expense

 

3,661

 

 

2,507

 

Other expense

 

281

 

 

527

 

Restructuring charges

 

1,702

 

 

175

 

Corporate activities expense

 

2,680

 

 

3,777

 

Corporate eliminations

 

(16

)

 

(18

)

Segment operating income

$

54,806

 

$

5,900

 

$

(250

)

$

49,156

 

$

56,568

 

$

-

$

56,568

 

FlyOver start-up costs1

 

878

 

 

-

 

 

-

 

 

878

 

 

351

 

 

-

 

351

 

Integration costs

 

235

 

 

236

 

 

-

 

 

(1

)

 

25

 

 

-

 

25

 

Acquisition transaction-related costs

 

83

 

 

-

 

 

(1

)

 

84

 

 

29

 

 

-

 

29

 

Adjusted segment operating income

 

56,002

 

 

6,136

 

 

(251

)

 

50,117

 

 

56,973

 

 

-

 

56,973

 

Segment depreciation

 

12,654

 

 

929

 

 

(96

)

 

11,821

 

 

13,233

 

 

-

 

13,233

 

Segment amortization

 

3,635

 

 

327

 

 

(21

)

 

3,329

 

 

2,896

 

 

-

 

2,896

 

Adjusted segment EBITDA

$

72,291

 

$

7,392

 

$

(368

)

$

65,267

 

$

73,102

 

$

-

$

73,102

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

(5,106

)

 

(2,718

)

 

2

 

 

(2,390

)

 

(1,959

)

 

-

 

(1,959

)

Adjusted segment EBITDA attributable to Viad

$

67,185

 

$

4,674

 

$

(366

)

$

62,877

 

$

71,143

 

$

-

$

71,143

 

Adjusted segment operating margin

 

15.4

%

 

47.0

%

 

8.7

%

 

14.2

%

 

15.9

%

 

15.9

%

Adjusted segment EBITDA margin

 

19.9

%

 

56.6

%

 

12.7

%

 

18.5

%

 

20.4

%

 

20.4

%

 
GES:
Revenue

$

227,445

 

$

-

 

$

(2,204

)

$

229,649

 

$

246,110

 

$

-

$

246,110

 

 
Segment operating income (loss)

$

(11,586

)

$

-

 

$

141

 

$

(11,727

)

$

1,160

 

$

-

$

1,160

 

Integration costs

 

-

 

 

-

 

 

-

 

 

-

 

 

25

 

 

-

 

25

 

Adjusted segment operating income (loss)

 

(11,586

)

 

-

 

 

141

 

 

(11,727

)

 

1,185

 

 

-

 

1,185

 

Depreciation

 

6,199

 

 

-

 

 

(63

)

 

6,262

 

 

7,077

 

 

-

 

7,077

 

Amortization

 

2,587

 

 

-

 

 

(15

)

 

2,602

 

 

2,354

 

 

-

 

2,354

 

Adjusted segment EBITDA

$

(2,800

)

$

-

 

$

63

 

$

(2,863

)

$

10,616

 

$

-

$

10,616

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

-

 

Adjusted segment EBITDA attributable to Viad

$

(2,800

)

$

-

 

$

63

 

$

(2,863

)

$

10,616

 

$

-

$

10,616

 

Adjusted segment operating margin

 

-5.1

%

 

-6.4

%

 

-5.1

%

 

0.5

%

 

0.5

%

Adjusted segment EBITDA margin

 

-1.2

%

 

-2.9

%

 

-1.2

%

 

4.3

%

 

4.3

%

 
GES North America:
Revenue

$

191,983

 

$

-

 

$

(138

)

$

192,121

 

$

200,855

 

$

-

$

200,855

 

 
Segment operating income (loss)

$

(8,562

)

$

-

 

$

(3

)

$

(8,559

)

$

1,367

 

$

-

$

1,367

 

Integration costs

 

-

 

 

-

 

 

-

 

 

-

 

 

25

 

 

-

 

25

 

Adjusted segment operating income (loss)

 

(8,562

)

 

-

 

 

(3

)

 

(8,559

)

 

1,392

 

 

-

 

1,392

 

Depreciation

 

4,927

 

 

-

 

 

(3

)

 

4,930

 

 

5,577

 

 

-

 

5,577

 

Amortization

 

2,330

 

 

-

 

 

-

 

 

2,330

 

 

2,060

 

 

-

 

2,060

 

Adjusted segment EBITDA

$

(1,305

)

$

-

 

$

(6

)

$

(1,299

)

$

9,029

 

$

-

$

9,029

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

-

 

Adjusted segment EBITDA attributable to Viad

$

(1,305

)

$

-

 

$

(6

)

$

(1,299

)

$

9,029

 

$

-

$

9,029

 

Adjusted segment operating margin

 

-4.5

%

 

2.2

%

 

-4.5

%

 

0.7

%

 

0.7

%

Adjusted segment EBITDA margin

 

-0.7

%

 

4.3

%

 

-0.7

%

 

4.5

%

 

4.5

%

 
GES EMEA:
Revenue

$

41,186

 

$

-

 

$

(2,066

)

$

43,252

 

$

47,634

 

$

-

$

47,634

 

 
Segment operating loss

$

(3,024

)

$

-

 

$

144

 

$

(3,168

)

$

(207

)

$

-

$

(207

)

Integration costs

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

-

 

Adjusted segment operating loss

 

(3,024

)

 

-

 

 

144

 

 

(3,168

)

 

(207

)

 

-

 

(207

)

Depreciation

 

1,272

 

 

-

 

 

(60

)

 

1,332

 

 

1,500

 

 

-

 

1,500

 

Amortization

 

257

 

 

-

 

 

(15

)

 

272

 

 

294

 

 

-

 

294

 

Adjusted segment EBITDA

$

(1,495

)

$

-

 

$

69

 

$

(1,564

)

$

1,587

 

$

-

$

1,587

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

-

 

Adjusted segment EBITDA attributable to Viad

$

(1,495

)

$

-

 

$

69

 

$

(1,564

)

$

1,587

 

$

-

$

1,587

 

Adjusted segment operating margin

 

-7.3

%

 

-7.0

%

 

-7.3

%

 

-0.4

%

 

-0.4

%

Adjusted segment EBITDA margin

 

-3.6

%

 

-3.3

%

 

-3.6

%

 

3.3

%

 

3.3

%

 
Pursuit:
Revenue

$

135,043

 

$

13,050

 

$

(697

)

$

122,690

 

$

112,053

 

$

-

$

112,053

 

 
Segment operating income

$

66,392

 

$

5,900

 

$

(391

)

$

60,883

 

$

55,408

 

$

-

$

55,408

 

Integration costs

 

235

 

 

236

 

 

-

 

 

(1

)

 

-

 

 

-

 

-

 

Acquisition transaction-related costs

 

83

 

 

-

 

 

(1

)

 

84

 

 

29

 

 

-

 

29

 

FlyOver start-up costs1

 

878

 

 

-

 

 

-

 

 

878

 

 

351

 

 

-

 

351

 

Adjusted segment operating income

 

67,588

 

 

6,136

 

 

(392

)

 

61,844

 

 

55,788

 

 

-

 

55,788

 

Depreciation

 

6,455

 

 

929

 

 

(33

)

 

5,559

 

 

6,156

 

 

-

 

6,156

 

Amortization

 

1,048

 

 

327

 

 

(6

)

 

727

 

 

542

 

 

-

 

542

 

Adjusted segment EBITDA

$

75,091

 

$

7,392

 

$

(431

)

$

68,130

 

$

62,486

 

$

-

$

62,486

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

(5,106

)

 

(2,718

)

 

2

 

 

(2,390

)

 

(1,959

)

 

-

 

(1,959

)

Adjusted segment EBITDA attributable to Viad

$

69,985

 

$

4,674

 

$

(429

)

$

65,740

 

$

60,527

 

$

-

$

60,527

 

Adjusted segment operating margin

 

50.0

%

 

47.0

%

 

56.2

%

 

50.4

%

 

49.8

%

 

49.8

%

Adjusted segment EBITDA margin

 

55.6

%

 

56.6

%

 

61.8

%

 

55.5

%

 

55.8

%

 

55.8

%

(A) Acquisitions include Mountain Park Lodges (acquired June 2019) and Belton Chalet (acquired May 2019) for Pursuit.
1 Includes costs related to the development of Pursuit's new FlyOver attractions in Iceland and Las Vegas

VIAD CORP AND SUBSIDIARIES

TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)

(UNAUDITED)

 
ADDITIONAL NON-GAAP FINANCIAL MEASURES
 
(per diluted share)

 

2018

 

Income (loss) before other items:

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Net income (loss) attributable to Viad

$

(0.47

)

$

1.15

 

$

1.83

 

$

(0.12

)

$

2.40

 

(Income) loss from discontinued operations attributable to Viad

 

(0.04

)

 

0.01

 

 

0.01

 

 

(0.05

)

 

(0.07

)

Income (loss) from continuing operations attributable to Viad

 

(0.51

)

 

1.16

 

 

1.84

 

 

(0.17

)

 

2.33

 

Restructuring charges, pre-tax

 

0.01

 

 

0.03

 

 

0.01

 

 

0.03

 

 

0.08

 

Acquisition-related costs and other non-recurring expenses, pre-tax

 

0.02

 

 

0.02

 

 

0.03

 

 

0.01

 

 

0.08

 

Tax benefit on above items

 

(0.01

)

 

(0.01

)

 

-

 

 

(0.01

)

 

(0.03

)

Adjustment related to Tax Reform

 

-

 

 

-

 

 

(0.15

)

 

-

 

 

(0.15

)

Unfavorable tax matters

 

-

 

 

-

 

 

-

 

 

0.05

 

 

0.05

 

Net loss attributable to FlyOver Iceland noncontrolling interest

 

-

 

 

-

 

 

(0.01

)

 

-

 

 

(0.02

)

Income (loss) before other items

$

(0.49

)

$

1.20

 

$

1.72

 

$

(0.09

)

$

2.34

 

 
 
 

Q4 2018

 

 

 

FY 2018

Adjusted segment operating income (loss) and adjusted segment EBITDA:

GES

 

Pursuit

 

Viad

 

 

 

GES

 

Pursuit

 

Viad

Net income (loss) attributable to Viad

$

(2,322

)

$

49,170

 

Net income (loss) attributable to noncontrolling interest

 

(348

)

 

542

 

Net loss attributable to redeemable noncontrolling interest

 

(28

)

 

(317

)

Income from discontinued operations

 

(1,078

)

 

(1,481

)

Income tax expense

 

1,813

 

 

17,095

 

Net interest expense

 

2,493

 

 

9,286

 

Other expense, pre-tax

 

436

 

 

1,744

 

Impairment recoveries, pre-tax

 

-

 

 

(35

)

Restructuring charges, pre-tax

 

588

 

 

1,587

 

Corporate activities expense

 

2,464

 

 

10,993

 

Corporate eliminations

 

(16

)

 

(67

)

Segment operating income (loss)

$

8,857

 

$

(4,855

)

$

4,002

 

$

39,602

 

$

48,915

 

$

88,517

 

FlyOver Iceland start-up costs

 

-

 

 

74

 

 

74

 

 

-

 

 

862

 

 

862

 

Integration costs

 

-

 

 

-

 

 

-

 

 

155

 

 

-

 

 

155

 

Acquisition transaction-related costs

 

-

 

 

39

 

 

39

 

 

-

 

 

136

 

 

136

 

Adjusted segment operating income (loss)

 

8,857

 

 

(4,742

)

 

4,115

 

 

39,757

 

 

49,913

 

 

89,670

 

Segment depreciation

 

6,759

 

 

3,105

 

 

9,864

 

 

28,456

 

 

17,167

 

 

45,623

 

Segment amortization

 

2,301

 

 

256

 

 

2,557

 

 

9,470

 

 

1,523

 

 

10,993

 

Adjusted segment EBITDA

$

17,917

 

$

(1,381

)

$

16,536

 

$

77,683

 

$

68,603

 

$

146,286

 

Adjusted segment EBITDA attributable to noncontrolling interest

 

-

 

 

369

 

 

369

 

 

-

 

 

(1,117

)

 

(1,117

)

Adjusted segment EBITDA attributable to Viad

$

17,917

 

$

(1,012

)

$

16,905

 

$

77,683

 

$

67,486

 

$

145,169

 

VIAD CORP AND SUBSIDIARIES
TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 
 

2018

($ in thousands)

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

 
Viad Consolidated:
Revenue

$

277,428

 

$

363,677

 

$

358,163

 

$

296,916

 

$

1,296,184

 

 
Net income (loss) attributable to Viad

$

(9,387

)

$

23,490

 

$

37,389

 

$

(2,322

)

$

49,170

 

Net income (loss) attributable to noncontrolling interest

 

(364

)

 

(33

)

 

1,287

 

 

(348

)

 

542

 

Net loss attributable to redeemable noncontrolling interest

 

(84

)

 

(77

)

 

(128

)

 

(28

)

 

(317

)

(Income) loss from discontinued operations

 

(928

)

 

279

 

 

246

 

 

(1,078

)

 

(1,481

)

Income tax expense (benefit)

 

(4,638

)

 

9,114

 

 

10,806

 

 

1,813

 

 

17,095

 

Net interest expense

 

1,985

 

 

2,301

 

 

2,507

 

 

2,493

 

 

9,286

 

Other expense

 

238

 

 

543

 

 

527

 

 

436

 

 

1,744

 

Impairment recoveries

 

-

 

 

(35

)

 

-

 

 

-

 

 

(35

)

Restructuring charges

 

162

 

 

662

 

 

175

 

 

588

 

 

1,587

 

Corporate activities expense

 

2,217

 

 

2,535

 

 

3,777

 

 

2,464

 

 

10,993

 

Corporate eliminations

 

(16

)

 

(17

)

 

(18

)

 

(16

)

 

(67

)

Segment operating income (loss)

$

(10,815

)

$

38,762

 

$

56,568

 

$

4,002

 

$

88,517

 

FlyOver Iceland start-up costs

 

231

 

 

206

 

 

351

 

 

74

 

 

862

 

Integration costs

 

61

 

 

69

 

 

25

 

 

-

 

 

155

 

Acquisition transaction-related costs

 

12

 

 

56

 

 

29

 

 

39

 

 

136

 

Adjusted segment operating income (loss)

 

(10,511

)

 

39,093

 

 

56,973

 

 

4,115

 

 

89,670

 

Segment depreciation

 

10,319

 

 

12,207

 

 

13,233

 

 

9,864

 

 

45,623

 

Segment amortization

 

2,688

 

 

2,852

 

 

2,896

 

 

2,557

 

 

10,993

 

Adjusted Segment EBITDA

$

2,496

 

$

54,152

 

$

73,102

 

$

16,536

 

$

146,286

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

479

 

 

(6

)

 

(1,959

)

 

369

 

 

(1,117

)

Adjusted Segment EBITDA Attributable to Viad

$

2,975

 

$

54,146

 

$

71,143

 

$

16,905

 

$

145,169

 

Adjusted segment operating margin

 

-3.8

%

 

10.7

%

 

15.9

%

 

1.4

%

 

6.9

%

Adjusted segment EBITDA margin

 

0.9

%

 

14.9

%

 

20.4

%

 

5.6

%

 

11.3

%

 
GES:
Revenue

$

267,706

 

$

315,322

 

$

246,110

 

$

281,759

 

$

1,110,897

 

 
Segment operating income

$

580

 

$

29,005

 

$

1,160

 

$

8,857

 

$

39,602

 

Integration costs

 

61

 

 

69

 

 

25

 

 

-

 

 

155

 

Adjusted segment operating income

 

641

 

 

29,074

 

 

1,185

 

 

8,857

 

 

39,757

 

Depreciation

 

7,352

 

 

7,268

 

 

7,077

 

 

6,759

 

 

28,456

 

Amortization

 

2,415

 

 

2,400

 

 

2,354

 

 

2,301

 

 

9,470

 

Adjusted Segment EBITDA

$

10,408

 

$

38,742

 

$

10,616

 

$

17,917

 

$

77,683

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

10,408

 

$

38,742

 

$

10,616

 

$

17,917

 

$

77,683

 

Adjusted segment operating margin

 

0.2

%

 

9.2

%

 

0.5

%

 

3.1

%

 

3.6

%

Adjusted segment EBITDA margin

 

3.9

%

 

12.3

%

 

4.3

%

 

6.4

%

 

7.0

%

 
GES North America:
Revenue

$

222,064

 

$

260,891

 

$

200,855

 

$

225,980

 

$

909,790

 

 
Segment operating income (loss)

$

(79

)

$

23,767

 

$

1,367

 

$

4,926

 

$

29,981

 

Integration costs

 

61

 

 

69

 

 

25

 

 

-

 

 

155

 

Adjusted segment operating income (loss)

 

(18

)

 

23,836

 

 

1,392

 

 

4,926

 

 

30,136

 

Depreciation

 

5,748

 

 

5,751

 

 

5,577

 

 

5,505

 

 

22,581

 

Amortization

 

2,094

 

 

2,095

 

 

2,060

 

 

2,026

 

 

8,275

 

Adjusted Segment EBITDA

$

7,824

 

$

31,682

 

$

9,029

 

$

12,457

 

$

60,992

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

7,824

 

$

31,682

 

$

9,029

 

$

12,457

 

$

60,992

 

Adjusted segment operating margin

 

0.0

%

 

9.1

%

 

0.7

%

 

2.2

%

 

3.3

%

Adjusted segment EBITDA margin

 

3.5

%

 

12.1

%

 

4.5

%

 

5.5

%

 

6.7

%

 
GES EMEA:
Revenue

$

48,920

 

$

60,662

 

$

47,634

 

$

61,031

 

$

218,247

 

 
Segment operating income (loss)

$

659

 

$

5,238

 

$

(207

)

$

3,931

 

$

9,621

 

Integration costs

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted segment operating income (loss)

 

659

 

 

5,238

 

 

(207

)

 

3,931

 

 

9,621

 

Depreciation

 

1,604

 

 

1,517

 

 

1,500

 

 

1,254

 

 

5,875

 

Amortization

 

321

 

 

305

 

 

294

 

 

275

 

 

1,195

 

Adjusted Segment EBITDA

$

2,584

 

$

7,060

 

$

1,587

 

$

5,460

 

$

16,691

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

2,584

 

$

7,060

 

$

1,587

 

$

5,460

 

$

16,691

 

Adjusted segment operating margin

 

1.3

%

 

8.6

%

 

-0.4

%

 

6.4

%

 

4.4

%

Adjusted segment EBITDA margin

 

5.3

%

 

11.6

%

 

3.3

%

 

8.9

%

 

7.6

%

 
Pursuit:
Revenue

$

9,722

 

$

48,355

 

$

112,053

 

$

15,157

 

$

185,287

 

 
Segment operating income (loss)

$

(11,395

)

$

9,757

 

$

55,408

 

$

(4,855

)

$

48,915

 

Integration costs

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Acquisition transaction-related costs

 

12

 

 

56

 

 

29

 

 

39

 

 

136

 

FlyOver Iceland start-up costs

 

231

 

 

206

 

 

351

 

 

74

 

 

862

 

Adjusted segment operating income (loss)

 

(11,152

)

 

10,019

 

 

55,788

 

 

(4,742

)

 

49,913

 

Depreciation

 

2,967

 

 

4,939

 

 

6,156

 

 

3,105

 

 

17,167

 

Amortization

 

273

 

 

452

 

 

542

 

 

256

 

 

1,523

 

Adjusted Segment EBITDA

$

(7,912

)

$

15,410

 

$

62,486

 

$

(1,381

)

$

68,603

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

479

 

 

(6

)

 

(1,959

)

 

369

 

 

(1,117

)

Adjusted Segment EBITDA Attributable to Viad

$

(7,433

)

$

15,404

 

$

60,527

 

$

(1,012

)

$

67,486

 

Adjusted segment operating margin **

 

20.7

%

 

49.8

%

 

-31.3

%

 

26.9

%

Adjusted segment EBITDA margin

 

-81.4

%

 

31.9

%

 

55.8

%

 

-9.1

%

 

37.0

%

 
** Greater than +/- 100 percent
VIAD CORP AND SUBSIDIARIES
TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 
 
 

2017

($ in thousands) Q1 Q2 Q3 Q4 Full Year
 
Viad Consolidated:
Revenue

$

325,807

 

$

364,774

 

$

339,099

 

$

277,285

 

$

1,306,965

 

 
Net income (loss) attributable to Viad

$

6,777

 

$

27,947

 

$

44,657

 

$

(21,674

)

$

57,707

 

Net income (loss) attributable to noncontrolling interest

 

(264

)

 

(73

)

 

1,084

 

 

(224

)

 

523

 

Net loss attributable to redeemable noncontrolling interest

 

-

 

 

-

 

 

-

 

 

(46

)

 

(46

)

(Income) loss from discontinued operations

 

816

 

 

(509

)

 

101

 

 

(140

)

 

268

 

Income tax expense

 

2,741

 

 

10,178

 

 

20,010

 

 

12,969

 

 

45,898

 

Net interest expense

 

2,047

 

 

2,017

 

 

2,043

 

 

1,878

 

 

7,985

 

Other expense

 

452

 

 

222

 

 

248

 

 

1,106

 

 

2,028

 

Impairment recoveries

 

(2,384

)

 

(2,247

)

 

(24,467

)

 

-

 

 

(29,098

)

Restructuring charges

 

394

 

 

168

 

 

255

 

 

187

 

 

1,004

 

Corporate activities expense

 

2,541

 

 

2,920

 

 

4,425

 

 

2,510

 

 

12,396

 

Corporate eliminations

 

(16

)

 

(16

)

 

(18

)

 

(17

)

 

(67

)

Segment operating income (loss)

$

13,104

 

$

40,607

 

$

48,338

 

$

(3,451

)

$

98,598

 

FlyOver Iceland start-up costs

 

-

 

 

-

 

 

-

 

 

125

 

 

125

 

Integration costs

 

213

 

 

49

 

 

25

 

 

48

 

 

335

 

Acquisition transaction-related costs

 

188

 

 

-

 

 

-

 

 

12

 

 

200

 

Adjusted segment operating income (loss)

 

13,505

 

 

40,656

 

 

48,363

 

 

(3,266

)

 

99,258

 

Segment depreciation

 

9,036

 

 

11,220

 

 

12,485

 

 

9,768

 

 

42,509

 

Segment amortization

 

3,059

 

 

3,253

 

 

3,301

 

 

2,795

 

 

12,408

 

Adjusted Segment EBITDA

$

25,600

 

$

55,129

 

$

64,149

 

$

9,297

 

$

154,175

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

363

 

 

46

 

 

(1,848

)

 

295

 

 

(1,144

)

Adjusted Segment EBITDA Attributable to Viad

$

25,963

 

$

55,175

 

$

62,301

 

$

9,592

 

$

153,031

 

Adjusted segment operating margin

 

4.1

%

 

11.1

%

 

14.3

%

 

-1.2

%

 

7.6

%

Adjusted segment EBITDA margin

 

7.9

%

 

15.1

%

 

18.9

%

 

3.4

%

 

11.8

%

 
GES:
Revenue

$

317,871

 

$

320,109

 

$

232,119

 

$

262,998

 

$

1,133,097

 

 
Segment operating income (loss)

$

23,379

 

$

30,669

 

$

(5,522

)

$

2,205

 

$

50,731

 

Integration costs

 

125

 

 

(30

)

 

20

 

 

46

 

 

161

 

Adjusted segment operating income (loss)

 

23,504

 

 

30,639

 

 

(5,502

)

 

2,251

 

 

50,892

 

Depreciation

 

6,285

 

 

6,638

 

 

6,691

 

 

6,830

 

 

26,444

 

Amortization

 

2,787

 

 

2,799

 

 

2,715

 

 

2,518

 

 

10,819

 

Adjusted Segment EBITDA

$

32,576

 

$

40,076

 

$

3,904

 

$

11,599

 

$

88,155

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

32,576

 

$

40,076

 

$

3,904

 

$

11,599

 

$

88,155

 

Adjusted segment operating margin

 

7.4

%

 

9.6

%

 

-2.4

%

 

0.9

%

 

4.5

%

Adjusted segment EBITDA margin

 

10.2

%

 

12.5

%

 

1.7

%

 

4.4

%

 

7.8

%

 
GES North America:
Revenue

$

273,589

 

$

263,664

 

$

199,153

 

$

207,546

 

$

943,952

 

 
Segment operating income (loss)

$

21,767

 

$

25,110

 

$

(2,967

)

$

(2,715

)

$

41,195

 

Integration costs

 

125

 

 

(59

)

 

9

 

 

36

 

 

111

 

Adjusted segment operating income (loss)

 

21,892

 

 

25,051

 

 

(2,958

)

 

(2,679

)

 

41,306

 

Depreciation

 

5,039

 

 

5,264

 

 

5,341

 

 

5,416

 

 

21,060

 

Amortization

 

2,371

 

 

2,370

 

 

2,276

 

 

2,182

 

 

9,199

 

Adjusted Segment EBITDA

$

29,302

 

$

32,685

 

$

4,659

 

$

4,919

 

$

71,565

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

29,302

 

$

32,685

 

$

4,659

 

$

4,919

 

$

71,565

 

Adjusted segment operating margin

 

8.0

%

 

9.5

%

 

-1.5

%

 

-1.3

%

 

4.4

%

Adjusted segment EBITDA margin

 

10.7

%

 

12.4

%

 

2.3

%

 

2.4

%

 

7.6

%

 
GES EMEA:
Revenue

$

47,506

 

$

63,208

 

$

39,668

 

$

59,443

 

$

209,825

 

 
Segment operating income (loss)

$

1,612

 

$

5,559

 

$

(2,555

)

$

4,920

 

$

9,536

 

Integration costs

 

-

 

 

29

 

 

11

 

 

10

 

 

50

 

Adjusted segment operating income (loss)

 

1,612

 

 

5,588

 

 

(2,544

)

 

4,930

 

 

9,586

 

Depreciation

 

1,246

 

 

1,374

 

 

1,350

 

 

1,414

 

 

5,384

 

Amortization

 

416

 

 

429

 

 

439

 

 

336

 

 

1,620

 

Adjusted Segment EBITDA

$

3,274

 

$

7,391

 

$

(755

)

$

6,680

 

$

16,590

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

Adjusted Segment EBITDA Attributable to Viad

$

3,274

 

$

7,391

 

$

(755

)

$

6,680

 

$

16,590

 

Adjusted segment operating margin

 

3.4

%

 

8.8

%

 

-6.4

%

 

8.3

%

 

4.6

%

Adjusted segment EBITDA margin

 

6.9

%

 

11.7

%

 

-1.9

%

 

11.2

%

 

7.9

%

 
Pursuit:
Revenue

$

7,936

 

$

44,665

 

$

106,980

 

$

14,287

 

$

173,868

 

 
Segment operating income (loss)

$

(10,275

)

$

9,938

 

$

53,860

 

$

(5,656

)

$

47,867

 

Integration costs

 

88

 

 

79

 

 

5

 

 

2

 

 

174

 

Acquisition transaction-related costs

 

188

 

 

-

 

 

-

 

 

12

 

 

200

 

FlyOver Iceland start-up costs

 

-

 

 

-

 

 

-

 

 

125

 

 

125

 

Adjusted segment operating income (loss)

 

(9,999

)

 

10,017

 

 

53,865

 

 

(5,517

)

 

48,366

 

Depreciation

 

2,751

 

 

4,582

 

 

5,794

 

 

2,938

 

 

16,065

 

Amortization

 

272

 

 

454

 

 

586

 

 

277

 

 

1,589

 

Adjusted Segment EBITDA

$

(6,976

)

$

15,053

 

$

60,245

 

$

(2,302

)

$

66,020

 

Adjusted Segment EBITDA Attributable to Noncontrolling Interest

 

363

 

 

46

 

 

(1,848

)

 

295

 

 

(1,144

)

Adjusted Segment EBITDA Attributable to Viad

$

(6,613

)

$

15,099

 

$

58,397

 

$

(2,007

)

$

64,876

 

Adjusted segment operating margin **

 

22.4

%

 

50.4

%

 

-38.6

%

 

27.8

%

Adjusted segment EBITDA margin

 

-87.9

%

 

33.7

%

 

56.3

%

 

-16.1

%

 

38.0

%

 
** Greater than +/- 100 percent

 

Contacts

Carrie Long
Investor Relations
(602) 207-2681
ir@viad.com

Release Summary

Viad Corp Reports 2019 Third Quarter Results

Contacts

Carrie Long
Investor Relations
(602) 207-2681
ir@viad.com