43 slides from Pursuit Attractions And Hospitality's investor presentation, Mar 29, 2016
Slide 1: Investor Presentation March 2016
1 Investor Presentation March 2016
Slide 2: Forward-Looking Statements
2 FORWARD - LOOKING STATEMENTS As provided by the safe harbor provision under the Private Securities Litigation Reform Act of 1995 , Viad cautions readers that, in addition to historical information contained herein, this presentation includes certain information, assumptions and discussions that ma
Slide 3: Agenda
3 Introduction to Viad 4 - 7 Marketing & Events Group 8 - 15 Travel & Recreation Group 16 - 23 Summary 24 - 27 Appendix 28 - 43
Slide 4: Introduction to Viad
4 Introduction to Viad
Slide 5: Introduction to Viad
5 INTRODUCTION TO VIAD Viad is a SmallCap 600 company with two business groups and a clear strategy for growth and shareholder value 90% 10% M&E T&R REVENUE $1.1B ADJUSTED SEGMENT EBITDA 1 $90.6M 60% 40% MARKETING & EVENTS 2015 1 A reconciliation of this non - GAAP measure to segment operating incom
Slide 6: Thorough Review of Strategic Options
6 THOROUGH REVIEW OF STRATEGIC OPTIONS 1 • Announced review of strategic options to enhance shareholder value (including possible separation of M&E and T&R businesses and increasing dividends or share repurchases), working with JP Morgan • Announced repurchase authorization of 1M shares (440,540 rem
Slide 7: Strong earnings growth and cash generation
7 $228M 1 A reconciliation of this non - GAAP measure can be found in the A ppendix. 2 Capex as a % of revenue was ~2% for GES and ~7% for T&R (excluding construction of the Glacier Skywalk and renovation of the Gondola) from 2011 - 15. 3 Net of proceeds from divestitures of non - strategic assets t
Slide 8: Marketing & Events Group: Global Experience Specialists (GES)
8 Marketing & Events Group Global Experience Specialists (GES)
Slide 9: GES – A Leading Service Provider to Global Live Events Market
9 GES – A LEADING SERVICE PROVIDER TO GLOBAL LIVE EVENTS MARKET GES is successfully leveraging its leading position in the large and growing Live Events market to capture share and outpace industry growth rates LIVE EVENTS ARE A BIG BUSINESS $12.5 Trillion Fortune 500 Revenue 1 – 3% o f Revenue S pe
Slide 10: GES Growth Strategy
10 GLOBAL REACH LIVE EVENTS FULL - SERVICE PROVIDER Drive Expansion Improve Margins Differentiate Addition of adjacent services creates a unique, integrated offering to deepen client relationships, expand client base and increase share of total event spend Position GES as the Preferred Global , Full
Slide 11: Global Leader in Exhibitions Market with Opportunity for Growth
11 GLOBAL LEADER IN EXHIBITIONS MARKET WITH OPPORTUNITY FOR GROWTH GLOBAL REACH ESTABLISHED POSITION 1 IN KEY GLOBAL MARKETS RECOGNIZED ABILITY TO SERVICE BROADER GEOGRAPHIES 30% 55% 45% US UK Canada 1 GES Official Services Contracting market share (internal estimates) BROAD CUSTOMER SET IN MULTIPLE
Slide 12: Driving Growth and Differentiation Through New Services
12 DRIVING GROWTH AND DIFFERENTIATION THROUGH NEW SERVICES GES has made significant progress creating the most comprehensive suite of services for the live events industry 4 ACQUISITIONS FOR $113M $18.1M 18 % AVERAGE IRR 2 ADJUSTED EBITDA 1 in 2015 In - house provider to top 4 UK venues Servicing ov
Slide 13: Attractive Margins
13 ATTRACTIVE MARGINS 5.6% 4.0% 19.5% 27.8% 2014 2015 ~24 PTS HIGHER FOR ACQUISITIONS ADJUSTED EBITDA 1 Margin CORE SERVICES AC QUISITIONS ACQUIRED SERVICES BRING ATTRACTIVE MARGINS AND GROWTH OPPORTUNITY GES REVENUE MIX (2015) 3% 3% 1% 93% Core Services Registration & Data Audio - Visual Event Acco
Slide 14: Driving Growth in Under-Penetrated Live Event Segments
14 Congresses / Conferences Exhibitions DRIVING GROWTH IN UNDER - PENETRATED LIVE EVENT SEGMENTS Consumer Events Industry leaders already select GES in every Live Event segment 63% o f Revenue 1 25% 7% 5% Corporate Events New services enhance differentiation and facilitate growth across the four cat
Slide 15: GES Is Driving Profitable Growth
15 2014 2015 2016 (est.) $944M >$1B $977M GES IS DRIVING PROFITABLE GROWTH By positioning GES as the preferred global, full - service provider for live events, we are driving growth in higher - margin service lines, increasing our share within the live events market and differentiating GES to enhanc
Slide 16: Travel & Recreation Group (T&R)
16 Travel & Recreation Group (T&R) Brewster Travel Canada Glacier Park, Inc. Alaska Denali Travel
Slide 17: Integrated Offerings in Markets with Perennial Demand
17 INTEGRATED OFFERINGS IN MARKETS WITH PERENNIAL DEMAND T&R is comprised of four lines of business that work together, driving economies of scope in and around iconic destinations targeting 9.2+ million annual visitors +9.9% T&R Revenue CAGR 2010 – 2015 T&R consistently drives growth in markets wit
Slide 18: Driving Growth Through Refresh, Build, Buy
18 DRIVING GROWTH IN HIGH VALUE AREAS THROUGH REFRESH, BUILD, BUY We have a focused growth strategy to add scale to the business by strategically investing in hospitality and attractions, which have the highest margins and strong return on investment Revenue ($M) 87 9.9% CAGR* 22% CAGR 9 % CAGR - 2%
Slide 19: Refresh – Positioning for Highest and Best Use
19 REFRESH – POSITIONING FOR HIGHEST AND BEST USE ~ $20M >30% INVESTMENT The Banff Gondola is undergoing significant renovations that will ensure its ongoing success as the must do attraction in Banff and position it for optimal returns 1 Assumes Exit EBITDA of 10x . IRR on full $20M capital investm
Slide 20: Build – Powerful New Experiences
20 BUILD - POWERFUL NEW EXPERIENCES THAT DRIVE POWERFUL RETURNS ~ $20M >90% INVESTMENT IRR 2 The Glacier Skywalk secured a significant return on investment, surpassing attendance expectations, and receiving international awards and media coverage Extensive Awards and Media Coverage Glacier Skywalk J
Slide 21: Buy – Proven Track Record of Returns on Acquisitions
21 BUY - PROVEN TRACK RECORD OF RETURNS ON ACQUISITIONS 21 1 Refers to Adjusted Segment EBITDA. A discussion of this non - GAAP measure can be found in the Appendix. 2 Assumes Exit EBITDA of 10x. January 2011 Grouse Mountain Lodge Year - round hotel in Whitefish, MT September 2011 Alaska Denali Trav
Slide 22: Hospitality Revenue Growth Outpaces Room Count
22 HOSPITALITY REVENUE GROWTH OUTPACES ROOM COUNT We have successfully pursued scale and enhanced performance in our hospitality operations +133% ‘15 vs. ‘10 +98% BANFF JASPER +122% GLACIER # of Hotel Rooms 1 133% INCREASE IN ROOM COUNT $38.2 $42.7 $25.7 $36.1 $15.5 +168% 168% INCREASE IN REVENUE 1
Slide 23: Continuing to Add Scale Through High-Margin Acquisitions
23 CONTINUING TO ADD SCALE THROUGH HIGH - MARGIN ACQUISITIONS Powerful combination of attractions and hospitality assets in existing geographies and service lines provide cross - selling opportunities and operational synergies January 2016 Maligne Lake Tours Interpretive boat tours, boat rentals, F&
Slide 24: Summary
Art and Science of Engage / a, SUMMARY
Slide 25: 2016 Outlook
25 2016 OUTLOOK We expect significant growth in 2016 , with an increase in total segment operating income (EBIT) in the range of 50% versus 2015 MARKETING & EVENTS GROUP • Revenue to exceed $1B (growth in the high single digits) • Positive show rotation of $50M - $55M • Same - show growth in the mid
Slide 26: Disciplined Acquisition Program
26 Viad has a disciplined and proactive acquisition program focused on proprietary deal - sourcing in support of our business unit strategies to drive shareholder value ACTIVE ACQUISITION PIPELINE Culture requirements: • Integrity • Customer - focus • Innovation • Continuous improvement Strong cultu
Slide 27: Viad Opportunity Summary
27 VIAD OPPORTUNITY SUMMARY WELL - DEFINED GROWTH STRATEGIES VISION Clear plans for meaningful growth BALANCED CAPITAL ALLOCATION STRATEGY PERFORMANCE Focus on shareholder return TWO SOLID BUSINESS GROUPS STRENGTH Strong, proven foundation Viad is in a strong position to enhance shareholder value •
Slide 28: Appendix
28 APPENDIX
Slide 29: Viad Summary Income Statement Data
29 VIAD SUMMARY INCOME STATEMENT DATA Note: Certain amounts above may not foot due to rounding. 1 Refer to the following pages for discussion and reconciliation of these non - GAAP measures to the most comparable GAAP measures. 2 Corporate activities expense have been adjusted to exclude acquisition
Slide 30: Non-GAAP Financial Measures
30 NON - GAAP FINANCIAL MEASURES This document includes the presentation of “Income B efore O ther Items” , “Adjusted Segment Operating Income” and “Adjusted Segment EBITDA” , which are supplemental to results presented under accounting principles generally accepted in the United States of America (
Slide 31: Non-GAAP Financial Measures, Continued
31 NON - GAAP FINANCIAL MEASURES, CONTINUED Note: Certain amounts above may not foot due to rounding . INCOME BEFORE OTHER ITEMS Millions (except per share amounts) 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 Income from Continuing Operations Attributable to Viad 7.4$ 3.3$ 19.4$ 40.8$ 27.0$ 0.
Slide 32: Non-GAAP Financial Measures, Continued
32 NON - GAAP FINANCIAL MEASURES, CONTINUED Note : Certain amounts above may not foot due to rounding . 1 Marketing & Events Group acquisitions include : Blitz Communications, onPeak and N 200 (all acquired in the second half of 2014 ) . 2 Travel & Recreation Group acquisitions include : Grouse Moun
Slide 33: Marketing & Events Group (GES) Key Metrics
33 MARKETING & EVENTS GROUP (GES) KEY METRICS • 3 - 5 year contracts • 90%+ renewal rate • Largest client is ~7% of GES revenue • Clients span broad range of industries; not overly exposed to any given industry US BASE SAME - SHOW GROWTH 1 2015 GEOGRAPHIC REVENUE MIX SHOW ROTATION 2 RECURRING & DIVE
Slide 34: GES - Significant Opportunity for Growth
34 GES - SIGNIFICANT OPPORTUNITY FOR GROWTH UNDER - PENETRATED SEGMENTS GES holds a leading position delivering its Core Services to the Exhibitions segment of the market and is expanding into other Live Events segments and New Services Exhibitions 1 in 3 major US shows is a GES client ~14,000 event
Slide 35: onPeak/Travel Planners – Acquired October 7, 2014
35 ONPEAK/TRAVEL PLANNERS – ACQUIRED OCTOBER 7, 2014 FOR $76.6M MARKET COMPANY OVERVIEW BUSINESS & SERVICES OVERVIEW KEY HIGHLIGHTS Leading technology platform , expert data analytics, innovative culture Strong customer service culture and capabilities with long - term client relationships STRATEGIC
Slide 36: onPeak/Travel Planners Integration Overview
36 ONPEAK/TRAVEL PLANNERS INTEGRATION OVERVIEW MERGER OVERVIEW Next largest serves 7% OTHER SYNERGIES • Increased scale provides stronger negotiating leverage with hotels to capture higher revenue commissions • Introduction of tiered pricing to increase booking capture rate • Best of breed capabilit
Slide 37: Blitz – Acquired September 16, 2014
37 BLITZ – ACQUIRED SEPTEMBER 16, 2014 FOR £15M ($24.4M) • Company Description : Blitz Communications is an AV staging and creative services provider for the live events industry in the UK and continental Europe, including corporate events, congresses and conferences, trade shows and select consumer
Slide 38: N200 – Acquired November 24, 2014
38 N200 – ACQUIRED NOVEMBER 24, 2014 FOR € 9.7M ($12.1M) MARKET COMPANY OVERVIEW BUSINESS & SERVICES OVERVIEW KEY HIGHLIGHTS Largest registration provider in the UK and The Netherlands Serves over 600 events each year, in 46 countries, supported by multi - lingual and multi - currency capabilities S
Slide 39: Travel & Recreation Group (T&R) Key Metrics
39 TRAVEL & RECREATION GROUP (T&R) KEY METRICS HOSPITALITY METRICS 1 2015 GEOGRAPHIC REVENUE MIX 2015 LINE OF BUSINESS REVENUE MIX ATTRACTIONS METRICS 1 71% 23% 6% Brewster Glacier Park Alaska Denali Travel (Canada) (Montana) (Alaska) 37% 37% 14% 12% Hospitality Attractions Packaged Tours Transporta
Slide 40: Attractions - Awesome Experience with Compelling Cross-Sell
40 ATTRACTIONS - AWESOME EXPERIENCE WITH COMPELLING CROSS - SELL T&R’s attractions have strong financial performance and offer cross - selling opportunities. 570,000 visits Visitation in 2015 BANFF GONDOLA 570,000 VISITS GLACIER SKYWALK 275,000 VISITS GLACIER ADVENTURE 435,000 VISITS BANFF LAKE CRUI
Slide 41: T&R Hospitality - Lodging Portfolio
41 T&R HOSPITALITY - LODGING PORTFOLIO The Travel & Recreation Group provides lodging accommodations in and around Glacier, Banff, Denali, Kenai Fjords and Jasper National Parks Property Name Location Operating Season Rooms Talkeetna Alaskan Lodge Denali National Park, AK May – Sept 212 Seward Winds
Slide 42: Continued Opportunity to Scale Business
42 CONTINUED OPPORTUNITY TO SCALE BUSINESS ROOMS PROPERTIES ROOMS PROPERTIES BANFF / JASPER MARKET Town of Banff 6% 5% 4,750 40 Jasper 0% 0% 2,346 25 Lake Louise 0% 0% 1,133 8 Icefields Parkway 11% 10% 291 10 TOTAL 4% 4% 8,520 83 GLACIER NATIONAL PARK MARKET Whitefish 18% 5% 810 19 Glacier NP 13% 20
Slide 43: Rationalizing Lower-Margin Lines of Business
43 RATIONALIZING LOWER - MARGIN LINES OF BUSINESS We are exiting certain lower - margin, capital intensive activities in our Transportation and Package Tours lines of business to improve margins and returns • Elevate guest experience and cross - sell through in - bus purchases to increase revenue pe