Viad Corp Reports Results for the 2023 First Quarter

• Year-over-year growth significantly exceeded expectations
• Strong momentum continues for GES live event activity and leisure travel to Pursuit’s markets
• Raising full year guidance for revenue, adjusted EBITDA, and free cash flow

Viad Corp (NYSE: VVI), a leading provider of experiential leisure travel and live events and marketing experiences, today reported results for the 2023 first quarter.

Financial Highlights

• Revenue increased by $83.4 million driven by improvements in live event activity and leisure travel relative to the 2022 first quarter.
• Net loss attributable to Viad improved by $8.1 million primarily due to strengthening demand for exhibitions and events and higher international tourism in Western Canada and Iceland.
• Consolidated adjusted EBITDA* improved by $14.7 million and exceeded the high-end of our prior guidance range.

* 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.

Steve Moster, Viad’s president and chief executive officer, commented, “We are very encouraged by the strong first quarter demand we experienced and our better than expected financial performance at both GES and Pursuit. GES continues to see positive momentum in the live events sector with improving revenue and healthy margins. At Pursuit, we saw ongoing acceleration of international visitation during this seasonally slow quarter that drove significant year-over-year revenue growth.”

Moster continued, “We’re off to a great start in 2023 and I am excited about the rest of the year as we expect the momentum to continue. Our actions to scale Pursuit, transform GES Exhibitions’ cost structure, and strengthen Spiro’s capabilities are positioning us for strong growth in revenue and profitability.”

Pursuit Results

* 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.

• Revenue increased $8.9 million (37%) from the 2022 first quarter.
  • Same-store revenue from experiences that were owned and open prior to 2022 increased $8.2 million primarily due to stronger international visitation at Sky Lagoon, our year-round Canadian experiences, and our FlyOver locations.
  • New experiences opened or acquired from 2022 forward contributed revenue of $0.7 million, mainly reflecting the addition of the Forest Park Alpine Hotel.
• Adjusted EBITDA improved by $1.2 million from the 2022 first quarter primarily due to the increase in revenue during the seasonally slow quarter.

Regarding Pursuit’s results, Moster commented, “Pursuit continues to post record levels of revenue, with first quarter revenue more than tripling the amount we generated in 2019. International leisure travel to our markets continues to accelerate and our new experiences continue to gain momentum. As compared to 2022, first quarter visitation to our year-round attractions increased about 40 percent, reflecting strong growth at Sky Lagoon, the Banff Gondola, and across our FlyOver locations.”

Moster continued, “The level of visitation we experienced across Pursuit during the seasonally slower first quarter was stronger than we had previously anticipated and gives us confidence that we will continue to see higher year-over-year revenues during the remainder of 2023. And the strong flow through of each incremental visitor is an important driver of margin expansion for Pursuit.”

GES Results

* 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.

• Revenue increased $74.6 million (49%) primarily driven by increased live event activity at both GES Exhibitions and Spiro relative to the 2022 first quarter that was impacted by cancellations and postponements due to COVID.
• Adjusted EBITDA increased by $14.0 million primarily due to higher revenue.

Regarding GES’ results, Moster commented, “GES delivered substantial year-over-year growth from both Spiro and GES Exhibitions as live event activity continued to rebound. Unlike last year when the industry was navigating the Omicron variant during the first quarter, events were able to stage as scheduled this quarter. Additionally, same-show revenues for events produced by our U.S. Exhibitions team grew to 91 percent of 2019 pre-pandemic levels as compared to 73 percent in the 2022 first quarter. At Spiro, spend from existing corporate clients’ is near 2019 pre-pandemic levels and we continue to benefit from new wins and a healthy pipeline of additional opportunities.”

Moster continued, “Our Exhibitions and Spiro teams executed extremely well during the quarter, servicing the increased client activity and delivering solid margins and cash flow. Our efforts to improve the cost structure within Exhibitions and to drive profitable growth at Spiro from new client wins and increased spend from existing clients are yielding great results. We remain focused on driving meaningful free cash flow through ongoing lean initiatives at GES Exhibitions and accelerated growth at Spiro.”

Cash Flow and Balance Sheet Highlights

Our 2023 first quarter cash flow from operations was an inflow of approximately $10 million and our capital expenditures totaled approximately $11 million. We paid approximately $2 million in cash dividends on our convertible preferred equity and our net debt payments were approximately $4 million.

We ended the first quarter with total liquidity of $139.9 million, comprising cash and cash equivalents of $50.8 million and $89.1 million of capacity available on our revolving credit facility ($100 million total facility size, less $10.9 million in letters of credit). Our debt totaled $478.4 million, including $394 million outstanding on our Term Loan B, financing lease obligations of approximately $65 million (which primarily comprises real estate leases at Pursuit), and approximately $20 million in other debt.

Moster commented, “We remain committed to protecting our balance sheet, maximizing our cash flows from operations, and selectively investing in high-return opportunities to continue scaling Pursuit. During the first quarter, we entered into an interest rate cap agreement that limits our exposure to continued interest rate increases and we amended the financial covenants for our revolving credit facility to provide additional cushion on our interest coverage ratio.”

2023 Outlook

Regarding Viad’s outlook, Moster commented, “With our stronger than expected start to 2023, we are pleased to be raising our full year guidance. We continue to see strengthening demand across the exhibition and event sector and from international leisure travel to Pursuit’s markets, along with acceleration of visitation at Pursuit’s new experiences.”

Our guidance for Viad consolidated is as follows:

Our guidance for Pursuit is as follows:

Our guidance for GES is as follows:

Conference Call Details

Management will host a conference call to review first quarter 2023 results on Thursday, May 4, 2023, at 5 p.m. (Eastern Time).

To join the live conference call, please register at least 10 minutes before the start of the call using the following link: https://conferencingportals.com/event/KFfVIwkJ. After registering, an email confirmation will be sent that includes dial-in information as well as unique codes for entry into the live call. Registration will be open throughout the call.

A live audio webcast of the call will also be available in listen-only mode through the “Investors" section of our website. A replay of the webcast will be available on our website shortly after the call and, for a limited time, by calling (800) 770-2030 or (647) 362-9199 and entering the conference ID 90039.

Additionally, we will post a supplemental presentation, containing highlights of our results, trends and outlook, on the “Investors” section of our website prior to the conference call. We will refer to this presentation during the call.

About Viad

Viad (NYSE: VVI), is a leading global provider of extraordinary experiences, including hospitality and leisure activities, experiential marketing, and live events through two businesses: Pursuit and GES. Our business strategy focuses on delivering extraordinary experiences for our teams, clients and guests, and significant and sustainable growth and above-market returns for our shareholders. Viad is an S&P SmallCap 600 company.

Pursuit is a collection of inspiring and unforgettable travel experiences in Alaska, Nevada, and Montana in the United States, in and around Banff, Jasper, and Vancouver in Canada, and in Reykjavik, Iceland. Pursuit’s collection includes attractions, lodges and hotels, and sightseeing tours that connect guests with iconic places.

GES is a global, full-service live events company offering a comprehensive range of services to the world's leading brands and event organizers through two reportable segments, Spiro and GES Exhibitions. Spiro is an experiential marketing agency that partners with leading brands around the world to manage and elevate their global experiential marketing activities. GES Exhibitions is a global exhibition services company that partners with leading exhibition and conference organizers as a full-service provider of strategic and logistics solutions to manage the complexity of their shows with teams throughout North America, Europe, and the Middle East.

For more information, visit www.viad.com.

Forward-Looking Statements

This press release contains a number of forward-looking statements. Words, and variations of words, such as “will,” “may,” “expect,” “would,” “could,” “might,” “intend,” “plan,” “believe,” “estimate,” “anticipate,” “deliver,” “seek,” “aim,” “potential,” “target,” “outlook,” and similar expressions are intended to identify our forward-looking statements. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions, or goals also are forward-looking statements. These forward-looking statements are not historical facts and are subject to a host of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those in the forward-looking statements.

Important factors that could cause actual results to differ materially from those described in our forward-looking statements include, but are not limited to, the following:

• 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 flexibility;
• identified material weaknesses 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 the impact 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 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.

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