8-K
Pursuit Attractions & Hospitality, Inc. (PRSU)
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 8, 2024
VIAD CORP
(Exact name of registrant as specified in its charter)
| Delaware | 001-11015 | 36-1169950 |
|---|---|---|
| (State or other jurisdiction<br><br> <br>of incorporation) | (Commission File Number) | (IRS Employer<br><br> <br>Identification No.) |
| 7000 East 1st Avenue<br><br> <br>Scottsdale, Arizona | 85251-4304 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (602) 207-1000
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions \(see General Instruction A.2. below\):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br><br> <br>Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $1.50 Par Value | VVI | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On February 8, 2024, we issued a press release announcing our earnings for the fourth quarter and full year ended December 31, 2023. A copy of the earnings press release is furnished as Exhibit 99.1 to this current report.
This press release, including Exhibit 99.1, will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and it will not be incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 7.01 Regulation FD Disclosure
On February 8, 2024, we posted an investor presentation to our website at www.viad.com. The information found on, or otherwise accessible through, our website is not incorporated by reference herein. A copy of the investor presentation is furnished as Exhibit 99.2 to this current report.
This investor presentation, including Exhibit 99.2, will not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section and it will not be incorporated by reference in any filing under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
| Exhibit<br><br> <br>Number | Description |
|---|---|
| 99.1 | Viad Corp<br> Press Release dated February 8, 2024 |
| 99.2 | Investor Presentation dated February 8, 2024 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Viad Corp | ||
|---|---|---|
| (Registrant) | ||
| February 8, 2024 | By: | /s/ Leslie S. Striedel |
| Leslie S. Striedel | ||
| Chief Accounting Officer |
Exhibit 99.1
NEWS FOR IMMEDIATE RELEASE
Viad Corp Reports 2023 Fourth Quarter and Full Year Results
| • | Pursuit delivered record results with 17% full year revenue growth and continued margin expansion |
|---|---|
| • | GES substantially outperformed expectations with 7% full year revenue growth and healthy margins |
| --- | --- |
| • | Strong growth and margin improvement expected again in 2024 |
| --- | --- |
SCOTTSDALE, February 8, 2024 -- Viad Corp (NYSE: VVI), a leading global provider of extraordinary experiences, including attractions, hospitality, exhibition management services, and experiential marketing, today reported results for the 2023 fourth quarter and full year.
Steve Moster, Viad’s President and Chief Executive Officer, commented, “We delivered strong fourth quarter and full year results, with consolidated revenue and adjusted EBITDA exceeding the high-end of our guidance. GES’ results significantly surpassed our expectations due to increased corporate client spending on high-margin experiential marketing services. Pursuit posted record revenue and benefited from increased demand for our inspiring and unforgettable attractions and hotels.”
Moster continued, “We are entering 2024 with great momentum as we see robust demand for our extraordinary experiences at both Pursuit and GES. We expect to deliver full year consolidated adjusted EBITDA year-over-year growth of approximately 16% to 30% in 2024 with strong free cash flow.”
Financial Highlights
| Three months ended<br><br> <br>December 31, | Year ended<br><br> <br>December 31, | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (in millions, except per share data) | 2023 | 2022 | % Change | 2023 | 2022 | % Change | ||||||||||||
| Revenue | $ | 291.7 | $ | 248.0 | 17.6 | % | $ | 1,238.7 | $ | 1,127.3 | 9.9 | % | ||||||
| Pursuit Revenue | 42.2 | 34.1 | 23.6 | % | 350.3 | 299.3 | 17.0 | % | ||||||||||
| GES Revenue | 249.5 | 213.9 | 16.6 | % | 888.4 | 828.0 | 7.3 | % | ||||||||||
| Net Income (Loss) Attributable to Viad | $ | (15.3 | ) | $ | (5.7 | ) | ** | $ | 16.0 | $ | 23.2 | -31.0 | % | |||||
| Net Income (Loss) Before Other Items* (Adjusted Net Income (Loss)) | $ | (14.6 | ) | $ | (25.5 | ) | 42.8 | % | $ | 18.6 | $ | 12.3 | 50.9 | % | ||||
| Income (Loss) Per Common Share Attributable to Viad (Diluted EPS) | $ | (0.83 | ) | $ | (0.37 | ) | ** | $ | 0.30 | $ | 0.53 | -43.4 | % | |||||
| Income (Loss) Before Other Items Per Common Share* (Adjusted Diluted EPS) | $ | (0.79 | ) | $ | (1.33 | ) | 40.6 | % | $ | 0.39 | $ | 0.16 | ** | |||||
| Consolidated Adjusted EBITDA* | $ | 14.5 | $ | (2.0 | ) | ** | $ | 147.0 | $ | 116.1 | 26.6 | % | ||||||
| Pursuit Adjusted EBITDA* | (8.3 | ) | (11.3 | ) | 25.9 | % | 92.6 | 67.9 | 36.3 | % | ||||||||
| GES Adjusted EBITDA* | 26.6 | 12.7 | ** | 68.2 | 61.3 | 11.3 | % | |||||||||||
| Corporate Adjusted EBITDA* | (3.7 | ) | (3.5 | ) | -6.9 | % | (13.8 | ) | (13.1 | ) | -5.1 | % |
* 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.
** Change is greater than +/- 100 percent.
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In addition to the commentary below, further information regarding our financial results, trends, and outlook are available in a supplemental earnings presentation, which can be accessed on the “Investors” section of our website, and in the financial tables accompanying this press release.
Full Year Results
| • | Revenue of $1.2 billion increased $111.4 million (9.9%) from the 2022 full year. |
|---|---|
| o | Pursuit revenue of $350.3 million increased $51.0 million (17.0%) year-over-year, primarily driven by stronger international tourism to Western Canada and<br> Iceland, as well as revenue management efforts to capture higher revenue per guest. |
| --- | --- |
| o | GES revenue of $888.4 million increased $60.4 million (7.3%) year-over-year, primarily due to improved demand for exhibition management and experiential<br> marketing services, which more than offset a $74 million year-over-year revenue impact from the sale of a non-core audio visual services business in 2022 and the timing of major non-annual shows. |
| --- | --- |
| • | Net income attributable to Viad of $16.0 million decreased $7.2 million from the 2022 full year primarily due to a $19.6 million gain on the sale of a<br> non-core audio visual business in the prior year, as well as higher interest expense and income tax expense, partially offset by improved business performance. |
| --- | --- |
| o | Net income before other items* (adjusted net income) of $18.6 million increased $6.3 million (50.9%) primarily due to higher adjusted EBITDA, partially<br> offset by increased interest expense and income tax expense. |
| --- | --- |
| • | Consolidated adjusted EBITDA* of $147.0 million increased $30.9 million (26.6%) from the 2022 full year. |
| --- | --- |
| o | Pursuit adjusted EBITDA* of $92.6 million increased $24.7 million (36.3%) year-over-year primarily driven by higher revenue and improved margin. |
| --- | --- |
| o | GES adjusted EBITDA of $68.2 million increased $6.9 million (11.3%) year-over-year primarily driven by higher revenue and improved margin. |
| --- | --- |
Fourth Quarter Results
| • | Revenue of $291.7 million increased $43.7 million (17.6%) from the 2022 fourth quarter. |
|---|---|
| o | Pursuit revenue of $42.2 million increased $8.1 million (23.6%) year-over-year primarily due to higher visitation and improved revenue per guest. |
| --- | --- |
| o | GES revenue of $249.5 million increased $35.6 million (16.6%) year-over-year primarily due to continued underlying growth and about $9 million of<br> incremental revenue from non-annual shows, partially offset by the loss of $13 million in revenue from a non-core audio visual services business that was sold in 2022. |
| --- | --- |
| • | Net loss attributable to Viad of $15.3 million increased $9.6 million from the 2022 fourth quarter primarily due to a $19.6 million gain on the sale of a<br> non-core audio visual business in 2022 and higher income tax expense, partially offset by improved business performance. |
| --- | --- |
| o | Net loss before other items* (adjusted net loss) of $14.6 million improved by $10.9 million primarily due to higher adjusted EBITDA, partially offset by<br> higher income tax expense. |
| --- | --- |
| • | Consolidated adjusted EBITDA* of $14.5 million increased $16.5 million from the 2022 fourth quarter. |
| --- | --- |
| o | Pursuit negative adjusted EBITDA* of $8.3 million improved by $2.9 million year-over-year primarily driven by higher revenue during the seasonally slow<br> quarter. |
| --- | --- |
| o | GES adjusted EBITDA of $26.6 million increased $13.9 million year-over-year primarily due to higher revenue and improved margin. |
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Cash Flow and Balance Sheet Highlights
| • | Our cash flow from operations was an outflow of $9.8 million for the fourth quarter and an inflow of $106.7 million for the full year. |
|---|---|
| • | Our capital expenditures for the fourth quarter totaled $23.6 million, comprising $20.3 million for Pursuit and $3.2 million for GES. For the full year, our<br> capital expenditures totaled $78.3 million, comprising $64.6 million for Pursuit (inclusive of about $39 million for growth projects) and $13.6 million for GES. |
| --- | --- |
| • | Our debt principal payments (net) totaled $17.1 million for the fourth quarter and $22.3 million for the full year. We paid cash dividends on our<br> convertible preferred equity of approximately $2.0 million for the fourth quarter and $7.8 million for the full year. |
| --- | --- |
| • | Our total liquidity was $160.7 million, comprising cash and cash equivalents of $52.7 million and $108.0 million of capacity available on our revolving<br> credit facility ($170 million total facility size, less $57 million outstanding balance and $5 million in letters of credit) at the end of the year. |
| --- | --- |
| • | Our debt was $462.1 million, and our net leverage ratio was 2.6 at the end of the year. |
| --- | --- |
2024 Outlook
Our guidance for Viad consolidated, Pursuit, and GES is as follows:
| (in millions) | First Quarter | Full Year |
|---|---|---|
| Viad Consolidated | ||
| Revenue | $260 to $284 | Up high-single to<br><br> <br>low-double digits |
| Adjusted EBITDA | $(0.5) to $7.5 | $171 to $191 |
| Cash flow from Operations | $5 to $15 | $120 to $140 |
| Capital Expenditures | $25 to $30<br><br> <br>(including<br><br> <br>growth capex of ~$10) | $65 to $70<br><br> <br>(including<br><br> <br>growth capex of ~$20) |
| Pursuit | ||
| Revenue | $35 to $39 | Up mid-single digits |
| Adjusted EBITDA | $(12) to $(8) | $105 to $115 |
| Key Assumptions | • FlyOver Chicago opens in March 2024<br><br> <br>• Strong demand for Pursuit’s iconic, unforgettable, inspiring experiences<br><br> <br>• Continued growth of international leisure travel |
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| (in millions) | First Quarter |
|---|---|
| GES | |
| Revenue | 225 to 245 |
| Adjusted EBITDA | 15 to 19 |
| Key Assumptions | • Major non-annual shows (~65M of incremental revenue vs. 2023, primarily in the<br> third quarter)<br> • Strong demand for GES’ experiential marketing and exhibition management services<br> • Increased exhibition and event show sizes |
All values are in US Dollars.
Conference Call Details
Management will host a conference call to review fourth quarter and full year 2023 results on Thursday, February 8, 2024, at 5 p.m. (Eastern Time).
The conference call can be accessed with operator assistance by calling (404) 975-4839 or (833) 470-1428 and entering the access code 092660.
To avoid wait time and bypass speaking with an operator to join the call, participants can pre-register using the following registration link: https://www.netroadshow.com/events/login?show=0de1640f&confId=59653. After registering, a calendar invitation will be sent that includes dial-in information as well as unique codes for entry into the live call. We recommend that you register in advance to ensure access for the full 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 (929) 458-6194 or (866) 813-9403 and entering the access code 706058.
Additionally, we posted a supplemental earnings presentation, containing our financial 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 attractions, hospitality, exhibition management services, and experiential marketing 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 global attractions and hospitality company that owns and operates a collection of inspiring and unforgettable experiences in iconic destinations. Pursuit’s elevated hospitality experiences enable visitors to discover and connect with world-class attractions, distinctive lodges, and engaging tours in stunning national parks and renowned global travel locations, in addition to experiencing our collection of Flyover Attractions in the vibrant cities of Vancouver, Reykjavik, Las Vegas, and Chicago (opening March 2024).
GES is a global exhibition management and experiential marketing company offering a comprehensive range of services to the world’s leading event organizers and brands through two reportable segments, GES Exhibitions and Spiro. GES Exhibitions is a global exhibition and trade show management business 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. Spiro is a global experiential marketing agency that partners with leading brands around the world to manage and elevate their experiential marketing activities, bonding brand and customer.
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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:
| • | general economic uncertainty in key global markets and a worsening of global economic conditions; |
|---|---|
| • | travel industry disruptions; |
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| • | the impact of our overall level of indebtedness, as well as our financial covenants, on our operational and financial flexibility; |
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| • | identified material weaknesses in our internal control over financial reporting; |
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| • | seasonality of our businesses; |
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| • | the impact of the COVID-19 pandemic on our financial condition, liquidity, and cash flow; |
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| • | our ability to anticipate and adjust for new and emerging challenges presented by the ramifications of the COVID-19 pandemic on our<br> businesses; |
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| • | unanticipated delays and cost overruns of our capital projects, and our ability to achieve established financial and strategic goals for<br> such projects; |
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| • | our exposure to labor shortages, turnover, and labor cost increases; |
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| • | the importance of key members of our account teams to our business relationships; |
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| • | our ability to manage our business and continue our growth if we lose any of our key personnel; |
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| • | the competitive nature of the industries in which we operate; |
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| • | our dependence on large exhibition event clients; |
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| • | adverse effects of show rotation on our periodic results and operating margins; |
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| • | transportation disruptions and increases in transportation costs; |
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| • | natural disasters, weather conditions, accidents, and other catastrophic events; |
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| • | our exposure to labor cost increases and work stoppages related to unionized employees; |
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| • | our multi-employer pension plan funding obligations; |
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| • | our ability to successfully integrate and achieve established financial and strategic goals from acquisitions; |
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| • | our exposure to cybersecurity attacks and threats; |
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| • | our exposure to currency exchange rate fluctuations; |
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| • | liabilities relating to prior and discontinued operations; and |
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| • | compliance with laws governing the storage, collection, handling, and transfer of personal data and our exposure to legal claims and<br> fines for data breaches or improper handling of such data. |
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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.
Contact
Carrie Long or Michelle Porhola
Investor Relations
(602) 207-2681
ir@viad.com
| VIAD CORP AND SUBSIDIARIES<br><br> <br>TABLE ONE - QUARTERLY AND FULL YEAR RESULTS<br><br> <br>(UNAUDITED) | ||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three months ended December 31, | Year ended December 31, | |||||||||||||||||||||
| (in thousands, except per share data) | 2023 | 2022 | Change | % Change | 2023 | 2022 | Change | % Change | ||||||||||||||
| Revenue: | ||||||||||||||||||||||
| Pursuit | $ | 42,208 | $ | 34,148 | 23.6 | % | $ | 350,285 | $ | 299,327 | 17.0 | % | ||||||||||
| GES: | ||||||||||||||||||||||
| Spiro | 83,554 | 72,123 | 15.8 | % | 283,171 | 277,641 | 2.0 | % | ||||||||||||||
| GES Exhibitions | 168,272 | 143,577 | 17.2 | % | 614,418 | 557,880 | 10.1 | % | ||||||||||||||
| Inter-segment eliminations | (2,355 | ) | (1,821 | ) | ) | -29.3 | % | (9,194 | ) | (7,537 | ) | ) | -22.0 | % | ||||||||
| Total GES | 249,471 | 213,879 | 16.6 | % | 888,395 | 827,984 | 7.3 | % | ||||||||||||||
| Total revenue | $ | 291,679 | $ | 248,027 | 17.6 | % | $ | 1,238,680 | $ | 1,127,311 | 9.9 | % | ||||||||||
| Segment operating income (loss): | ||||||||||||||||||||||
| Pursuit | $ | (18,693 | ) | $ | (20,091 | ) | 7.0 | % | $ | 53,381 | $ | 24,031 | ** | |||||||||
| GES: | ||||||||||||||||||||||
| Spiro | 12,091 | 4,805 | ** | 23,723 | 23,133 | 2.6 | % | |||||||||||||||
| GES Exhibitions | 11,104 | 3,992 | ** | 31,339 | 21,780 | 43.9 | % | |||||||||||||||
| Total GES | 23,195 | 8,797 | ** | 55,062 | 44,913 | 22.6 | % | |||||||||||||||
| Segment operating income (loss) | $ | 4,502 | $ | (11,294 | ) | ** | $ | 108,443 | $ | 68,944 | 57.3 | % | ||||||||||
| Corporate eliminations | 10 | 16 | ) | -37.5 | % | 59 | 67 | ) | -11.9 | % | ||||||||||||
| Corporate activities | (3,785 | ) | (3,537 | ) | ) | -7.0 | % | (14,040 | ) | (13,418 | ) | ) | -4.6 | % | ||||||||
| Gain on sale of ON Services (Note A) | - | 19,637 | ) | -100.0 | % | (204 | ) | 19,637 | ) | ** | ||||||||||||
| Restructuring (charges) recoveries (Note B) | (49 | ) | 408 | ) | ** | (1,174 | ) | (3,059 | ) | 61.6 | % | |||||||||||
| Impairment charges | - | - | ** | - | (583 | ) | -100.0 | % | ||||||||||||||
| Other expense, net | (500 | ) | (547 | ) | 8.6 | % | (2,033 | ) | (2,077 | ) | 2.1 | % | ||||||||||
| Net interest expense (Note C) | (10,897 | ) | (11,001 | ) | 0.9 | % | (47,978 | ) | (34,891 | ) | ) | -37.5 | % | |||||||||
| Income (loss) from continuing operations before income taxes | (10,719 | ) | (6,318 | ) | ) | -69.7 | % | 43,073 | 34,620 | 24.4 | % | |||||||||||
| Income tax expense (Note D) | (5,176 | ) | (386 | ) | ) | ** | (18,799 | ) | (9,973 | ) | ) | -88.5 | % | |||||||||
| Income (loss) from continuing operations | (15,895 | ) | (6,704 | ) | ) | ** | 24,274 | 24,647 | ) | -1.5 | % | |||||||||||
| Income (loss) from discontinued operations (Note E) | 33 | (137 | ) | ** | (822 | ) | 148 | ) | ** | |||||||||||||
| Net income (loss) | (15,862 | ) | (6,841 | ) | ) | ** | 23,452 | 24,795 | ) | -5.4 | % | |||||||||||
| Net (income) loss attributable to noncontrolling interest | 385 | 708 | ) | -45.6 | % | (7,836 | ) | (2,323 | ) | ) | ** | |||||||||||
| Net loss attributable to redeemable noncontrolling interest | 131 | 394 | ) | -66.8 | % | 401 | 748 | ) | -46.4 | % | ||||||||||||
| Net income (loss) attributable to Viad | $ | (15,346 | ) | $ | (5,739 | ) | ) | ** | $ | 16,017 | $ | 23,220 | ) | -31.0 | % | |||||||
| Amounts Attributable to Viad: | ||||||||||||||||||||||
| Income (loss) from continuing operations | $ | (15,379 | ) | $ | (5,602 | ) | ) | ** | $ | 16,839 | $ | 23,072 | ) | -27.0 | % | |||||||
| Income (loss) from discontinued operations (Note E) | 33 | (137 | ) | ** | (822 | ) | 148 | ) | ** | |||||||||||||
| Net income (loss) | $ | (15,346 | ) | $ | (5,739 | ) | ) | ** | $ | 16,017 | $ | 23,220 | ) | -31.0 | % | |||||||
| Income (loss) per common share attributable to Viad (Note F): | ||||||||||||||||||||||
| Basic income (loss) per common share | $ | (0.83 | ) | $ | (0.37 | ) | ) | ** | $ | 0.30 | $ | 0.54 | ) | -44.4 | % | |||||||
| Diluted income (loss) per common share | $ | (0.83 | ) | $ | (0.37 | ) | ) | ** | $ | 0.30 | $ | 0.53 | ) | -43.4 | % | |||||||
| Weighted-average common shares outstanding: | ||||||||||||||||||||||
| Basic weighted-average outstanding common shares | 20,942 | 20,656 | 1.4 | % | 20,855 | 20,589 | 1.3 | % | ||||||||||||||
| Additional dilutive shares related to share-based compensation | - | - | ** | 242 | 223 | 8.5 | % | |||||||||||||||
| Diluted weighted-average outstanding common shares | 20,942 | 20,656 | 1.4 | % | 21,097 | 20,812 | 1.4 | % | ||||||||||||||
| Adjusted EBITDA* by Reportable Segment: | ||||||||||||||||||||||
| Pursuit | $ | (8,332 | ) | $ | (11,251 | ) | 25.9 | % | $ | 92,623 | $ | 67,949 | 36.3 | % | ||||||||
| GES: | ||||||||||||||||||||||
| Spiro | 12,451 | 5,795 | ** | 25,903 | 26,975 | ) | -4.0 | % | ||||||||||||||
| GES Exhibitions | 14,140 | 6,926 | ** | 42,273 | 34,282 | 23.3 | % | |||||||||||||||
| Total GES | 26,591 | 12,721 | ** | 68,176 | 61,257 | 11.3 | % | |||||||||||||||
| Corporate | (3,717 | ) | (3,476 | ) | ) | -6.9 | % | (13,754 | ) | (13,089 | ) | ) | -5.1 | % | ||||||||
| Consolidated Adjusted EBITDA | $ | 14,542 | $ | (2,006 | ) | ** | $ | 147,045 | $ | 116,117 | 26.6 | % | ||||||||||
| As of December 31, | ||||||||||||||||||||||
| Capitalization Data: | 2023 | 2022 | Change | % Change | ||||||||||||||||||
| Cash and cash equivalents | $ | 52,704 | $ | 59,719 | ) | -11.7 | % | |||||||||||||||
| Total debt | 462,128 | 481,792 | ) | -4.1 | % | |||||||||||||||||
| Viad shareholders' equity | 41,392 | 14,530 | ** | |||||||||||||||||||
| Non-controlling interests (redeemable and non-redeemable) | 93,921 | 87,266 | 7.6 | % | ||||||||||||||||||
| Convertible Series A Preferred Stock (Note G): | ||||||||||||||||||||||
| 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 | % |
All values are in US Dollars.
| * Refer to Table Two for a discussion and reconciliation of this non-GAAP financial measure to its most directly<br> 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<br> Viad's balance sheet. |
| VIAD CORP AND SUBSIDIARIES<br><br> <br>TABLE ONE - NOTES TO QUARTERLY AND FULL YEAR RESULTS<br><br> <br>(UNAUDITED) | ||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (A) | Gain on Sale of ON Services — On December 15, 2022, we completed the sale of substantially all of the assets of GES’<br> United States audio-visual production business, ON Services. We recognized a gain on sale of approximately $19.6 million. | |||||||||||||||||||||
| (B) | Restructuring (Charges) Recoveries – Restructuring charges during the years ended 2023 and 2022 were primarily related<br> to our 2022 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 year ended 2023 relative to 2022 was primarily due to<br> higher interest rates in 2023. | |||||||||||||||||||||
| (D) | Income Tax Expense – The effective tax rate was 43.6% for the year ended December 31, 2023 and 28.8% for the year ended<br> December 31, 2022. We generated higher income in 2023 than 2022 in our tax jurisdictions without a valuation allowance (VA) and were not able to recognize a benefit on losses in our jurisdictions with a VA. The effective tax<br> rate was negative 48.3% for the three months ended December 31, 2023 and 6.1% for the three months ended December 31, 2022. In the fourth quarter of 2023, we generated higher income in our tax jurisdictions without a VA than in<br> 2022 and were not able to recognize a benefit on losses in our jurisdictions with a VA. | |||||||||||||||||||||
| (E) | Income (Loss) from Discontinued Operations — The loss from discontinued operations during the year ended 2023 was<br> primarily due to legal matters related to previously sold operations. | |||||||||||||||||||||
| (F) | Income (Loss) per Common Share — We apply the two-class method in calculating income (loss) per common share as<br> 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<br> income per share. | |||||||||||||||||||||
| Diluted income (loss) per common share is calculated using the more dilutive of the two-class method or as-converted<br> 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<br> 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<br> stock. | ||||||||||||||||||||||
| Additionally, the adjustment to the carrying value of redeemable non-controlling interests is reflected in income (loss)<br> per common share. | ||||||||||||||||||||||
| The components of basic and diluted income (loss) per share are as follows: | ||||||||||||||||||||||
| Three months ended December 31, | Year ended December 31, | |||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (in thousands) | 2023 | 2022 | Change | % Change | 2023 | 2022 | Change | % Change | ||||||||||||||
| Net income (loss) attributable to Viad | $ | (15,346 | ) | $ | (5,739 | ) | ) | ** | $ | 16,017 | $ | 23,220 | ) | -31.0 | % | |||||||
| Convertible preferred stock dividends paid in cash | (1,950 | ) | (1,950 | ) | 0.0 | % | (7,801 | ) | (7,801 | ) | 0.0 | % | ||||||||||
| Adjustment to the redemption value of redeemable noncontrolling interest | - | - | ** | - | (763 | ) | -100.0 | % | ||||||||||||||
| Undistributed income (loss) attributable to Viad | (17,296 | ) | (7,689 | ) | ) | ** | 8,216 | 14,656 | ) | -43.9 | % | |||||||||||
| Less: Allocation to participating securities | - | - | ** | (1,993 | ) | (3,600 | ) | 44.6 | % | |||||||||||||
| Net income (loss) allocated to Viad common shareholders (basic) | $ | (17,296 | ) | $ | (7,689 | ) | ) | ** | $ | 6,223 | $ | 11,056 | ) | -43.7 | % | |||||||
| Add: Allocation to participating securities | - | - | ** | 18 | 30 | -40.0 | % | |||||||||||||||
| Net income (loss) allocated to Viad common shareholders (diluted) | $ | (17,296 | ) | $ | (7,689 | ) | ) | ** | $ | 6,241 | $ | 11,086 | ) | -43.7 | % | |||||||
| Basic weighted-average outstanding common shares | 20,942 | 20,656 | 1.4 | % | 20,855 | 20,589 | 1.3 | % | ||||||||||||||
| Additional dilutive shares related to share-based compensation | - | - | ** | 242 | 223 | 8.5 | % | |||||||||||||||
| Diluted weighted-average outstanding common shares | 20,942 | 20,656 | 1.4 | % | 21,097 | 20,812 | 1.4 | % |
All values are in US Dollars.
| (G) | Convertible Series A Preferred Stock — On August 5, 2020, we entered into an Investment Agreement with funds managed by<br> 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<br> 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<br> per share. |
|---|
| VIAD CORP AND SUBSIDIARIES<br><br> <br>TABLE TWO - NON-GAAP FINANCIAL MEASURES<br><br> <br>(UNAUDITED) | ||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| IMPORTANT DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||||||
| This document includes the presentation of "Income (Loss) Before Other Items", "Adjusted EBITDA", "Segment Operating<br> 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<br> 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<br> 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<br> 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<br> 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<br> 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<br> 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<br> 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<br> corporate development projects, both from a valuation and return perspective. | ||||||||||||||||||||||
| Three months ended December 31, | Year ended December 31, | |||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (in thousands, except per share data) | 2023 | 2022 | Change | % Change | 2023 | 2022 | Change | % Change | ||||||||||||||
| Net income (loss) before other items (adjusted net income (loss)): | ||||||||||||||||||||||
| Net income (loss) attributable to Viad | $ | (15,346 | ) | $ | (5,739 | ) | ) | ** | $ | 16,017 | $ | 23,220 | ) | -31.0 | % | |||||||
| (Income) loss from discontinued operations attributable to Viad | (33 | ) | 137 | ) | ** | 822 | (148 | ) | ** | |||||||||||||
| Income (loss) from continuing operations attributable to Viad | (15,379 | ) | (5,602 | ) | ) | ** | 16,839 | 23,072 | ) | -27.0 | % | |||||||||||
| Gain on sale of ON Services, pre-tax | - | (19,637 | ) | -100.0 | % | 204 | (19,637 | ) | ** | |||||||||||||
| Restructuring charges (recoveries), pre-tax | 49 | (408 | ) | ** | 1,174 | 3,059 | ) | -61.6 | % | |||||||||||||
| Impairment charges, pre-tax | - | - | ** | - | 583 | ) | -100.0 | % | ||||||||||||||
| Acquisition-related costs and other non-recurring expenses, pre-tax (Note A) | 1,002 | 572 | 75.2 | % | 3,237 | 3,884 | ) | -16.7 | % | |||||||||||||
| Remeasurement of finance lease obligation attributable to Viad, pre-tax (Note B) | (267 | ) | (410 | ) | 34.9 | % | (865 | ) | 2,120 | ) | ** | |||||||||||
| Tax expense (benefit) on above items | 20 | 16 | 25.0 | % | 113 | (755 | ) | ** | ||||||||||||||
| Favorable tax matters | - | - | ** | (2,103 | ) | - | ) | ** | ||||||||||||||
| Net income (loss) before other items (adjusted net income (loss)) | $ | (14,575 | ) | $ | (25,469 | ) | 42.8 | % | $ | 18,599 | $ | 12,326 | 50.9 | % | ||||||||
| The components of net income (loss) before other items per common share (adjusted diluted EPS) are as follows: | ||||||||||||||||||||||
| Net income (loss) before other items (adjusted<br><br><br><br><br> net income (loss)) (as reconciled above) | $ | (14,575 | ) | $ | (25,469 | ) | 42.8 | % | $ | 18,599 | $ | 12,326 | 50.9 | % | ||||||||
| Convertible preferred stock dividends paid in cash | (1,950 | ) | (1,950 | ) | 0.0 | % | (7,801 | ) | (7,801 | ) | 0.0 | % | ||||||||||
| Undistributed income (loss) before other items attributable to Viad (Note C) | (16,525 | ) | (27,419 | ) | 39.7 | % | 10,798 | 4,525 | ** | |||||||||||||
| Less: Allocation to participating securities (Note D) | - | - | ** | (2,596 | ) | (1,102 | ) | ) | ** | |||||||||||||
| Diluted income (loss) before other items allocated to Viad common shareholders | $ | (16,525 | ) | $ | (27,419 | ) | 39.7 | % | $ | 8,202 | $ | 3,423 | ** | |||||||||
| Diluted weighted-average outstanding common shares | 20,942 | 20,656 | 1.4 | % | 21,097 | 20,812 | 1.4 | % | ||||||||||||||
| Income (loss) before other items per common share (adjusted diluted EPS) | $ | (0.79 | ) | $ | (1.33 | ) | 40.6 | % | $ | 0.39 | $ | 0.16 | ** | |||||||||
| (A) Acquisition-related costs and other non-recurring expenses include: | ||||||||||||||||||||||
| Three months ended December 31, | Year ended December 31, | |||||||||||||||||||||
| (in thousands) | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
| Acquisition integration costs - Pursuit^1^ | $ | - | $ | 101 | $ | 30 | $ | 237 | ||||||||||||||
| Acquisition transaction-related costs - Pursuit^1^ | 158 | 24 | 342 | 1,259 | ||||||||||||||||||
| Acquisition transaction-related costs - Corporate^2^ | 26 | 29 | 43 | 68 | ||||||||||||||||||
| Attraction start-up costs^1, 3^ | 814 | 418 | 2,723 | 2,169 | ||||||||||||||||||
| Other non-recurring expenses^2, 4^ | 4 | - | 99 | 151 | ||||||||||||||||||
| Acquisition-related and other non-recurring expenses, pre-tax | $ | 1,002 | $ | 572 | $ | 3,237 | $ | 3,884 |
All values are in US Dollars.
| ^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 Chicago and Toronto, and<br> Forest Park Hotel in Canada. | ||||||||
| ^4^ Includes non-capitalizable fees and expenses related to Viad’s credit facility refinancing efforts. | ||||||||
| (B) | Remeasurement of finance lease obligation attributable to Viad represents the non-cash foreign exchange loss/(gain)<br> included within Cost of Services related to the periodic remeasurement of the Sky Lagoon finance lease obligation that is attributed to Viad’s 51% interest in Sky Lagoon. | |||||||
| --- | --- | |||||||
| (C) | We exclude the adjustment to the redemption value of redeemable noncontrolling interest from the calculation of income<br> before other items per share as it is a non-cash adjustment that does not affect net income or loss attributable to Viad. | |||||||
| (D) | Preferred stock and unvested share-based payment awards that contain nonforteitable rights to dividends are considered<br> 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<br> table provides the share data used for calculating the allocation to participating securities if applicable: | |||||||
| Three months ended December 31, | Year ended December 31, | |||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| (in thousands) | 2023 | 2022 | 2023 | 2022 | ||||
| Weighted-average outstanding common shares | 20,942 | 20,656 | 21,097 | 20,812 | ||||
| Effect of participating convertible preferred shares (if applicable) | - | - | 6,674 | 6,674 | ||||
| Effect of participating non-vested shares (if applicable) | - | - | 2 | 29 | ||||
| Weighted-average shares including effect of participating interests (if applicable) | 20,942 | 20,656 | 27,773 | 27,515 | ||||
| ** Change is greater than +/- 100 percent | ||||||||
| --- |
| VIAD CORP AND SUBSIDIARIES<br><br> <br>TABLE TWO - NON-GAAP FINANCIAL MEASURES (CONTINUED)<br><br> <br>(UNAUDITED) | ||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three months ended December 31, | Year ended December 31, | |||||||||||||||||||||
| ($ in thousands) | 2023 | 2022 | Change | % Change | 2023 | 2022 | Change | % Change | ||||||||||||||
| Viad Consolidated: | ||||||||||||||||||||||
| Revenue | $ | 291,679 | $ | 248,027 | 17.6 | % | $ | 1,238,680 | $ | 1,127,311 | 9.9 | % | ||||||||||
| Net income (loss) attributable to Viad | $ | (15,346 | ) | $ | (5,739 | ) | ) | ** | $ | 16,017 | $ | 23,220 | ) | -31.0 | % | |||||||
| Net income (loss) attributable to noncontrolling interest | (385 | ) | (708 | ) | 45.6 | % | 7,836 | 2,323 | ** | |||||||||||||
| Net loss attributable to redeemable noncontrolling interest | (131 | ) | (394 | ) | 66.8 | % | (401 | ) | (748 | ) | 46.4 | % | ||||||||||
| (Income) loss from discontinued operations | (33 | ) | 137 | ) | ** | 822 | (148 | ) | ** | |||||||||||||
| Net interest expense | 10,897 | 11,001 | ) | -0.9 | % | 47,978 | 34,891 | 37.5 | % | |||||||||||||
| Income tax expense | 5,176 | 386 | ** | 18,799 | 9,973 | 88.5 | % | |||||||||||||||
| Depreciation and amortization | 13,336 | 13,041 | 2.3 | % | 51,043 | 52,483 | ) | -2.7 | % | |||||||||||||
| Gain on sale of ON Services | - | (19,637 | ) | -100.0 | % | 204 | (19,637 | ) | ** | |||||||||||||
| Restructuring charges (recoveries) | 49 | (408 | ) | ** | 1,174 | 3,059 | ) | -61.6 | % | |||||||||||||
| Impairment charges | - | - | ** | - | 583 | ) | -100.0 | % | ||||||||||||||
| Other expense, net | 500 | 547 | ) | -8.6 | % | 2,033 | 2,077 | ) | -2.1 | % | ||||||||||||
| Start-up costs (A) | 814 | 418 | 94.7 | % | 2,723 | 2,169 | 25.5 | % | ||||||||||||||
| Acquisition transaction-related costs | 184 | 53 | ** | 385 | 1,327 | ) | -71.0 | % | ||||||||||||||
| Integration costs | - | 101 | ) | -100.0 | % | 30 | 237 | ) | -87.3 | % | ||||||||||||
| Other non-recurring expenses | 4 | - | ** | 99 | 151 | ) | -34.4 | % | ||||||||||||||
| Remeasurement of finance lease obligation (B) | (523 | ) | (804 | ) | 35.0 | % | (1,697 | ) | 4,157 | ) | ** | |||||||||||
| Consolidated Adjusted EBITDA | $ | 14,542 | $ | (2,006 | ) | ** | $ | 147,045 | $ | 116,117 | 26.6 | % | ||||||||||
| Adjusted EBITDA attributable to noncontrolling interest | (1,131 | ) | (246 | ) | ) | ** | (15,904 | ) | (10,950 | ) | ) | -45.2 | % | |||||||||
| Consolidated Adjusted EBITDA attributable to Viad | $ | 13,411 | $ | (2,252 | ) | ** | $ | 131,141 | $ | 105,167 | 24.7 | % | ||||||||||
| Consolidated Adjusted EBITDA by Business: | ||||||||||||||||||||||
| Pursuit | $ | (8,332 | ) | $ | (11,251 | ) | 25.9 | % | $ | 92,623 | $ | 67,949 | 36.3 | % | ||||||||
| Total GES | 26,591 | 12,721 | ** | 68,176 | 61,257 | 11.3 | % | |||||||||||||||
| Total Segment EBITDA | 18,259 | 1,470 | ** | 160,799 | 129,206 | 24.5 | % | |||||||||||||||
| Corporate EBITDA | (3,717 | ) | (3,476 | ) | ) | -6.9 | % | (13,754 | ) | (13,089 | ) | ) | -5.1 | % | ||||||||
| Consolidated Adjusted EBITDA | $ | 14,542 | $ | (2,006 | ) | ** | $ | 147,045 | $ | 116,117 | 26.6 | % | ||||||||||
| Pursuit Adjusted EBITDA: | ||||||||||||||||||||||
| Revenue | $ | 42,208 | $ | 34,148 | 23.6 | % | $ | 350,285 | $ | 299,327 | 17.0 | % | ||||||||||
| Cost of services and products | (60,901 | ) | (54,239 | ) | ) | -12.3 | % | (296,904 | ) | (275,296 | ) | ) | -7.8 | % | ||||||||
| Segment operating income (loss) | (18,693 | ) | (20,091 | ) | 7.0 | % | 53,381 | 24,031 | ** | |||||||||||||
| Depreciation | 8,816 | 7,926 | 11.2 | % | 32,937 | 31,075 | 6.0 | % | ||||||||||||||
| Amortization | 1,096 | 1,175 | ) | -6.7 | % | 4,907 | 5,021 | ) | -2.3 | % | ||||||||||||
| Start-up costs (A) | 814 | 418 | 94.7 | % | 2,723 | 2,169 | 25.5 | % | ||||||||||||||
| Acquisition transaction-related costs | 158 | 24 | ** | 342 | 1,259 | ) | -72.8 | % | ||||||||||||||
| Integration costs | - | 101 | ) | -100.0 | % | 30 | 237 | ) | -87.3 | % | ||||||||||||
| Remeasurement of finance lease obligation (B) | (523 | ) | (804 | ) | 35.0 | % | (1,697 | ) | 4,157 | ) | ** | |||||||||||
| Adjusted EBITDA | $ | (8,332 | ) | $ | (11,251 | ) | 25.9 | % | $ | 92,623 | $ | 67,949 | 36.3 | % | ||||||||
| Adjusted EBITDA attributable to noncontrolling interest | (1,131 | ) | (246 | ) | ) | ** | (15,904 | ) | (10,950 | ) | ) | -45.2 | % | |||||||||
| Adjusted EBITDA attributable to Viad | $ | (9,463 | ) | $ | (11,497 | ) | 17.7 | % | $ | 76,719 | $ | 56,999 | 34.6 | % | ||||||||
| Pursuit Operating margin | -44.3 | % | -58.8 | % | 14.5 | % | 15.2 | % | 8.0 | % | 7.2 | % | ||||||||||
| Pursuit Adjusted EBITDA margin | -19.7 | % | -32.9 | % | 13.2 | % | 26.4 | % | 22.7 | % | 3.7 | % | ||||||||||
| Total GES Adjusted EBITDA: | ||||||||||||||||||||||
| Revenue | $ | 249,471 | $ | 213,879 | 16.6 | % | $ | 888,395 | $ | 827,984 | 7.3 | % | ||||||||||
| Cost of services and products | (226,276 | ) | (205,082 | ) | ) | -10.3 | % | (833,333 | ) | (783,071 | ) | ) | -6.4 | % | ||||||||
| Segment operating income | 23,195 | 8,797 | ** | 55,062 | 44,913 | 22.6 | % | |||||||||||||||
| Depreciation | 2,427 | 2,802 | ) | -13.4 | % | 9,202 | 11,914 | ) | -22.8 | % | ||||||||||||
| Amortization | 969 | 1,122 | ) | -13.6 | % | 3,912 | 4,430 | ) | -11.7 | % | ||||||||||||
| Total GES Adjusted EBITDA | $ | 26,591 | $ | 12,721 | ** | $ | 68,176 | $ | 61,257 | 11.3 | % | |||||||||||
| Total GES Operating margin | 9.3 | % | 4.1 | % | 5.2 | % | 6.2 | % | 5.4 | % | 0.8 | % | ||||||||||
| Total GES Adjusted EBITDA margin | 10.7 | % | 5.9 | % | 4.7 | % | 7.7 | % | 7.4 | % | 0.3 | % | ||||||||||
| GES Adjusted EBITDA by Reportable Segment: | ||||||||||||||||||||||
| Spiro | $ | 12,451 | $ | 5,795 | ** | $ | 25,903 | $ | 26,975 | ) | -4.0 | % | ||||||||||
| GES Exhibitions | 14,140 | 6,926 | ** | 42,273 | 34,282 | 23.3 | % | |||||||||||||||
| Total GES | $ | 26,591 | $ | 12,721 | ** | $ | 68,176 | $ | 61,257 | 11.3 | % | |||||||||||
| Spiro Revenue | $ | 83,554 | $ | 72,123 | 15.8 | % | $ | 283,171 | $ | 277,641 | 2.0 | % | ||||||||||
| Spiro Adjusted EBITDA Margin | 14.9 | % | 8.0 | % | 6.9 | % | 9.1 | % | 9.7 | % | -0.6 | % | ||||||||||
| GES Exhibitions Revenue | $ | 168,272 | $ | 143,577 | 17.2 | % | $ | 614,418 | $ | 557,880 | 10.1 | % | ||||||||||
| GES Exhibitions Adjusted EBITDA Margin | 8.4 | % | 4.8 | % | 3.6 | % | 6.9 | % | 6.1 | % | 0.7 | % | ||||||||||
| (A) Includes costs related to the development of Pursuit's new FlyOver attractions in Chicago and Toronto, and Forest<br> Park Hotel in Canada. | ||||||||||||||||||||||
| (B) Remeasurement of finance lease obligation represents the non-cash foreign exchange loss/(gain) included within Cost<br> of Services related to the periodic remeasurement of the Sky Lagoon finance lease obligation. |
All values are in US Dollars.
| Exhibit 99.2 |
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fourth quarter and full year 2023 EARNINGS CALL February 8, 2024
Forward-looking statements This presentation 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, initiatives, 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: general economic uncertainty in key global markets and a worsening of global economic conditions; travel industry disruptions; the impact of our overall level of indebtedness, as well as our financial covenants, on our operational and financial flexibility; identified material weakness in our internal control over financial reporting; seasonality of our businesses; the impact of the COVID-19 pandemic on our financial condition, liquidity, and cash flow; our ability to anticipate and adjust for new and emerging challenges presented by the ramifications of the COVID-19 pandemic on 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; our ability to manage our business and continue our growth if we lose any of our key personnel; 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 presentation except as required by applicable law or regulation. 2
NON-GAAP FINANCIAL MEASURES This document includes the presentation of “Adjusted EBITDA” and ”Net Income (Loss) Before Other Items (Adjusted Net 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 should be considered in addition to, but not as a substitute 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 it does not consider a variety of items affecting Viad’s consolidated financial performance as explained 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. Adjusted EBITDA is defined by management as net income attributable to Viad before income (loss) from discontinued operations, interest expense and interest income, income taxes, depreciation and amortization, acquisition-related costs, attraction start-up costs, restructuring charges, impairment charges, and the reduction/increase for income/loss attributable to non-redeemable and redeemable non-controlling interests, and gains or losses from sales of businesses. Adjusted EBITDA is considered a useful operating metric, in addition to net income attributable to Viad, as potential variations arising from non-recurring integration costs, non-cash amortization and depreciation, and non-operational expenses/income are eliminated, thus resulting in an additional measure considered to be indicative of Viad’s consolidated and segment 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. Net Income (Loss) Before Other Items (Adjusted Net Income (Loss)) is defined by management as net income attributable to Viad before income (loss) from discontinued operations, acquisition-related costs, attraction start-up costs, restructuring charges, impairment charges, other non-recurring expenses, and tax matters. Net Income (Loss) Before Other Items (Adjusted Net Income (Loss)) is considered a useful operating metric, in addition to net income attributable to Viad, as potential variations arising from non-operational expenses/income are eliminated, thus resulting in an additional measure considered to be indicative of Viad’s performance. 3 Forward-Looking Non-GAAP Measures The company has not quantitatively reconciled its guidance for adjusted EBITDA to its respective most comparable GAAP 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.
Q4’23 & FY’23 Earnings Call HIGHLIGHTS 4 36% Adjusted EBITDA growth 11% Adjusted EBITDA growth ~16-30% Adjusted EBITDA growth
FINANCIAL PERFORMANCE & OUTLOOK
6 solid Q4’23 RESULTS 6 Revenue grew 17.6% versus Q4’22, reflecting healthy growth at both Pursuit and GES Adjusted EBITDA* grew $16.5 million with improvements at both Pursuit and GES Net Loss Before Other Items* improved by $10.9 million primarily driven by stronger Adjusted EBITDA partially offset by increased tax expense Net Loss Attributable to Viad increased by $9.6 million primarily due to the Q4’22 gain on sale of a non-core AV business, partially offset by stronger operating performance in Q4’23 * Refer to Appendix for a discussion and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure. $ MILLIONS, except per share data Q4’23 CHANGE VS. Q4’22 Revenue $291.7 $43.7 Pursuit Revenue $42.2 $8.1 GES Revenue $249.5 $35.6 Net Loss Attributable to Viad $(15.3) $(9.6) Net Loss Before Other Items (Adjusted Net Loss)* $(14.6) $10.9 Loss per Common Share Attributable to Viad (Diluted EPS) $(0.83) $(0.46) Loss Before Other Items per Common Share (Adjusted Diluted EPS)* $(0.79) $0.54 Consolidated Adjusted EBITDA* $14.5 $16.5 Pursuit Adjusted EBITDA* $(8.3) $2.9 GES Adjusted EBITDA* $26.6 $13.9 Corporate Adjusted EBITDA* $(3.7) $(0.2)
7 PURSUIT Q4’23 YEAR-OVER-YEAR RESULTS 7 * Refer to Appendix for a discussion and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure. ** Same-Store metrics include only attractions and lodging properties that Pursuit operated at full capacity, considering seasonal closures, for the entirety of the 2023 and 2022 periods presented. For experiences located outside the United States, financial metric comparisons to the prior year are expressed on a constant U.S. dollar basis. Note: Amounts may not add as presented due to rounding Revenue increased 23.6% year-over-year with growth across all categories Continued to see strong demand for our experiences and destinations Attractions ticket revenue grew 34% on a 23% increase in visitors and higher effective ticket prices Particularly strong visitation growth across Western Canada attractions, as well as at Sky Lagoon in Iceland Adjusted EBITDA improved by $2.9 million on higher revenue PURSUIT ($ MILLIONS) Q4’23 CHANGE VS. Q4’22 Revenue: Ticket Revenue $20.8 $5.2 Room Revenue $7.6 $0.5 Food & Beverage $7.1 $1.2 Retail Operations $2.7 $0.5 All Other $4.0 $0.6 Total Revenue $42.2 $8.1 Adjusted EBITDA* $(8.3) $2.9 Adjusted EBITDA Margin -19.7% 13.2% Metrics: Attraction Visitors (000’s) 549.0 23.0% Same-Store Attraction ETP** $38 7.8% Same-Store Lodging RevPAR** $66 2.5%
8 GES Q4’23 YEAR-OVER-YEAR RESULTS 8 Revenue increased 16.6% year-over-year reflecting: Continued underlying growth Incremental revenue of about $9 million from non-annual shows Loss of about $13 million in revenue from ON Services (sold in December 2022) Excluding the impacts of major non-annual shows and ON Services, revenue increased ~20% Spiro revenue grew ~23% on strong spending from existing and new clients GES Exhibitions revenue grew ~18% as event sizes continued to improve and GES was selected to produce a large globally rotating event Adjusted EBITDA* increased $13.9 million with strong flow-through on the growth in revenue GES ($ MILLIONS) Q4’23 CHANGE VS. Q4’22 Revenue: Spiro $83.6 $11.4 GES Exhibitions $168.3 $24.7 Inter-Segment Elims $(2.4) $(0.5) Total Revenue $249.5 $35.6 Adjusted EBITDA*: Spiro $12.5 $6.7 GES Exhibitions $14.1 $7.2 Total Adjusted EBITDA* $26.6 $13.9 Adjusted EBITDA Margin: Spiro 14.9% 6.9% GES Exhibitions 8.4% 3.6% Total Adjusted EBITDA Margin 10.7% 4.7% Metrics: Major Non-Annual Show Revenue $9 $9 U.S. Exhibition Same-Show Revenue $36.9 11.9% * Refer to Appendix for a discussion and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure. Note: Amounts may not add as presented due to rounding
Strong FY’23 RESULTS 9 CONSOLIDATED REVENUE ($M) +10% CONSOLIDATED ADJ. EBITDA* ($M) +27% $ MILLIONS, except per share data FY’23 CHANGE VS. FY’22 Revenue $1,238.7 $111.4 Pursuit Revenue $350.3 $51.0 GES Revenue $888.4 $60.4 Net Income Attributable to Viad $16.0 $(7.2) Net Income Before Other Items (Adjusted Net Income)* $18.6 $6.3 Income per Common Share Attributable to Viad (Diluted EPS) $0.30 $(0.23) Income Before Other Items per Common Share (Adjusted Diluted EPS)* $0.39 $0.23 Consolidated Adjusted EBITDA* $147.0 $30.9 Pursuit Adjusted EBITDA* $92.6 $24.7 GES Adjusted EBITDA* $68.2 $6.9 Corporate Adjusted EBITDA* $(13.8) $(0.7) * Refer to Appendix for a discussion and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure. Note: Amounts may not add as presented due to rounding
FINANCIAL OUTLOOK – Q1’24 & FY’24 $ MILLIONS Q1’24 GUIDANCE FY’24 GUIDANCE Pursuit: Revenue Adjusted EBITDA $35 to $39 $(12) to $(8) Up mid-single digits $105 to $115 GES: Revenue Adjusted EBITDA $225 to $245 $15 to $19 Up low-double digits $80 to $90 Consolidated: Revenue Adjusted EBITDA* Cash from Operations Capital Expenditures $260 to $284 $(0.5) to $7.5 $5 to $15 $25 to $30 (includes ~$10 for growth) Up high-single to low-double digits $171 to $191 $120 to $140 $65 to $70 (includes ~$20 for growth) 10 *Viad Consolidated Adjusted EBITDA represents segments less corporate costs.
12 PURSUIT’s Fy’23 attraction PERFORMANCE TICKET REVENUE ($M) +25% 2023F 2024P 25% year-over-year ticket revenue growth driven by strong increases in visitation and pricing Substantial increases in visitation from the return of international tourism to Western Canada and Iceland Newer experiences launched in recent years, including the Sky Lagoon, FlyOver Las Vegas, and Golden Skybridge delivered significant visitation increases over 2022 VISITATION (K) SAME-STORE ETP +21% +6% Note: Same-Store metrics include only attractions properties that Pursuit operated at full capacity, considering seasonal closures, for the entirety of the 2023 and 2022 periods presented. For experiences located outside the United States, financial metric comparisons to the prior year are expressed on a constant U.S. dollar basis. Sky Lagoon, Reykjavík, Iceland
13 PURSUIT’s FY’23 LODGING PERFORMANCE ROOM REVENUE ($M) +12% 2023F 2024P 12% year-over-year room revenue growth with increases in both ADR and occupancy Room revenue increased across all geographies, with exceptionally strong performance from our Canadian hotels Benefited from return of international tourism to Canada and Forest Park Alpine Hotel (opened in August 2022) SAME-STORE ADR SAME-STORE OCCUPANCY +2% SAME-STORE REVPAR +9% +6% Note: Same-Store metrics include only lodging properties that Pursuit operated at full capacity, considering seasonal closures, for the entirety of the 2023 and 2022 periods presented. For experiences located outside the United States, financial metric comparisons to the prior year are expressed on a constant U.S. dollar basis. Pyramid Lake Lodge, Jasper, Canada
14 PURSUIT’s LODGING BOOKING PACE +22% US LODGING ROOM REVENUE ON THE BOOKS* (USD $M) +4% CANADIAN LODGING ROOM REVENUE ON THE BOOKS* (CAD $M) 2022 2023 2024 * Room Revenue on the Books data represents reservations taken to date as of February 2, 2022, 2023, and 2024. 2022 2023 2024 ADR +17% vs. 2023 ADR +13% vs. 2023
15 PURSUIT’s OVERALL REVENUE GROWTH FY REVENUE ($M) +17% 2022 2023 17% year-over-year revenue growth in 2023 Continued revenue growth expected in 2024 Key Drivers: Strong demand for iconic, unforgettable, inspiring experiences Pricing power FlyOver Chicago opens March 2024 Increased visitation 2024 Est Up mid-single digits
16 PURSUIT’s margin expansion FY ADJUSTED EBITDA MARGIN (%) +370 bps 2022 2022 2023 370 bps year-over-year margin increase in 2023 Continued strong margin improvement expected in 2024 to reach 30% target Key Drivers: Higher attraction visitation with strong throughput Revenue management Prudent labor and expense management 2024 Est FY ADJUSTED EBITDA (M) $68 $93 $105-115
18 GES 2023 YEAR-OVER-YEAR Revenue growth 18 Total revenue grew 7% year-over-year 19% y-o-y growth when adjusting to exclude the impact of ON Services and Major Non-Annual Shows 19% y-o-y excluding impact of ON Services and Non-Annuals $Millions
19 EXHIBITIONS’ INDUSTRY HAS SUBSTANTIALLYRECOVERED WITH ROOM FOR MORE GROWTH 19 In Q4’23, GES Exhibitions’ same show revenue remained above 2019 levels FY same-show revenue growth vs. 2022 was 18.6% Show sizes on average remain below pre-pandemic levels Substantial opportunity for future growth as event sizes fully recover * The US same show metric compares tradeshows that occurred in the same city for both occurrences and generally represents between 20% and 50% of the total exhibition revenue. GES US Exhibitions Same-Show* Revenue and Square Footage vs. 2019 Pre-Pandemic Occurrence
20 SPIRO’S GROWTH STRATEGY LARGE FRAGMENTED GROWING MARKET Experiential marketing is forecasted to rise globally at ~9% CAGR to $105B by 2026 ~80% of brands view experiential events as their most important marketing channel ~86% of brands plan to attend or host more in-person events in 2024 than in 2023 Sources: PQ Media Global Experiential Marketing Forecast 2022-2026, Bizzabo Well-positioned to win business from new and existing clients to drive accelerated growth: Global network End to end in-house solutions – from strategy & creative to execution & analytics Enhanced capabilities – expanded creative & design resources Industry leading expertise in multiple verticals Marquee client base NEW CLIENTS since Spiro launched in Q1’22 55
21 GES’ OVERALL REVENUE GROWTH FY REVENUE ($M) 2022 2023 7% year-over-year revenue growth in 2023 Excluding ON Services and major non-annual shows: 19% overall revenue growth 23% Exhibitions revenue growth 11% Spiro revenue growth Continued revenue growth expected in 2024 Key Drivers: Continued recovery of exhibition show sizes and pricing strength Spiro winning new clients and cultivating existing clients from expanding capabilities 2024 will benefit from major non-annual shows (~$65M of incremental revenue) +7% 2024 Est. Up low-double digits
22 GES’ margin expansion FY ADJUSTED EBITDA MARGIN (%) +30 bps 2022 2022 2023 2024 Est. 30 bps year-over-year margin increase in 2023 Continued margin improvement expected in 2024 to surpass 8% target Key Drivers: Exhibitions’ show sizes recovering New Spiro wins with improved SG&A leverage Continued focus on efficiency with lean productivity initiatives FY ADJUSTED EBITDA (M) $61 $68 $80-90
APPENDIX
24 REVENUE AND ADJUSTED EBITDA
FORWARD-LOOKING NON-GAAP FINANCIAL MEASURES We have also provided forward−looking guidance for Adjusted EBITDA, a non−GAAP financial measure. We do not provide a reconciliation of the forward−looking guidance of Adjusted EBITDA, a non−GAAP financial measure, to the most directly comparable GAAP financial measure because, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible, not all of the information necessary for quantitative reconciliations is available to us without unreasonable efforts. Consequently, any attempt to disclose such reconciliations would imply a degree of precision that could be confusing or misleading to investors. It is possible that the forward−looking non−GAAP financial measure may be materially different from the corresponding forward-looking GAAP financial measure. NON-GAAP FINANCIAL RECONCILIATION 25 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. Includes inventory write-offs at GES in connection with transitioning to an outsourced model for trade show aisle carpet. Includes non-capitalizable fees and expenses related to Viad’s credit facility refinancing efforts. Remeasurement of finance lease obligation represents the non-cash foreign exchange loss/(gain) included within Cost of Services related to the periodic remeasurement of the Sky Lagoon finance lease obligation. Corporate Adjusted EBITDA is calculated as Corporate activities expense before depreciation, acquisition-transaction-related costs and other non-recurring costs included within Corporate activities expense.
26 NON-GAAP FINANCIAL RECONCILIATION Remeasurement of finance lease obligation attributable to Viad represents the non-cash foreign exchange loss/(gain) included within Cost of Services related to the periodic remeasurement of the Sky Lagoon finance lease obligation that is attributed to Viad’s 51% interest in Sky Lagoon.
27 Pursuit key performance metrics 27
PURSUIT METRICS vs. pre-pandemic 2019 28 Note: Same-Store metrics include only attractions and lodging properties that Pursuit operated at full capacity, considering seasonal closures, for the entirety of the 2023, 2022, and 2019 periods presented. For experiences located outside the United States, financial metric comparisons to the prior year are expressed on a constant U.S. dollar basis. New attractions opened or acquired after January 1, 2019 and excluded from the same-store ETP, include Glacier Raft Co. (acquired April 2022), FlyOver Las Vegas (opened September 2021), Golden Skybridge (opened June 2021), Sky Lagoon (opened May 2021), Open Top Touring (opened September 2020), and FlyOver Iceland (opened August 2019). New lodging properties opened or acquired after January 1, 2019 and excluded from the same-store RevPAR and ADR, include Forest Park Hotel (opened August 2022), Glacier Raft Co (acquired April 2022), Glacier Basecamp Lodge (acquired January 2020), West Glacier RV Park (opened July 2019), Mountain Park Lodges (acquired June 2019), and Belton Chalet (acquired May 2019). Lodging and attraction experiences show significant improvement compared to the prior year and pre-pandemic 2019
29 Cash Flow and Balance Sheet highlights 29