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| Statement |
|---|
| Thanks to the great effort of our Exhibition team to improving pricing, deliver great service and grow our share of spend on the show floor |
| I'm very happy to report that our finish to 2023 exceeded our expectations in what was a great year for our businesses |
| GES substantially outperformed our prior guidance during the quarter and Pursuit delivered solid results in this seasonally slower period |
| Looking at the year as a whole, Pursuit set new records for both revenue and EBITDA, with the continued return of international leisure travel to our destinations and our expanded portfolio of experiences |
| It allows us to continue to maintain things at a high level and also keep improving experiences and at the same time, be it a great margin business that we can sustain over the long term |
| We have a great deal of optimism as we enter 2024 in a position of strength with robust demand for our extraordinary experiences at Pursuit and GES, and tailwinds from a strong non-annual show schedule and the opening of FlyOver Chicago |
| We expect to deliver very strong revenue and EBITDA growth again this year |
| But the jump this year to almost '27 and then coming in on '24 at 30%, we believe 33% is a really sustainable and powerful margin for the business |
| Revenue increased $43.7 million or 17.6% year-over-year with healthy growth at both Pursuit and GES |
| Consolidated adjusted EBITDA increased $16.5 million and our fourth quarter net loss before other items improved by $10.9 million |
| And we are very pleased with what we were able to accomplish in 2023, given that it's a traditionally lower non-annual show rotation for this year |
| As shown on Page 7, Pursuit's fourth quarter revenue grew $8.1 million or 23.6% year-over-year and adjusted EBITDA improved by $2.9 million |
| Pursuit delivered growth across all revenue categories as we continued to see strong demand for our experiences and destinations in this seasonally slow period |
| Attractions ticket revenue saw the largest year-over-year gain with an increase of 34%, driven by a 23% increase in visitors and higher effective ticket prices |
| Visitation growth was particularly strong across our Western Canada attractions as well as at our Sky Lagoon attraction in Iceland |
| And Maligne Lake is a great example of a very successful business, very highly rated from a guest experience standpoint |
| Spiro delivered revenue growth of $11.4 million or 15.8%, excluding the impact of non-annual events in the sale of ON services, Spiro's revenue growth rate was about 23% versus the 2022 fourth quarter driven by strong spending from existing and new clients |
| GES exhibitions delivered revenue growth of $24.7 million or 17.2%, excluding the impact of non-annual events and the sale of ON services, GES exhibitions revenue growth rate was about 18% versus the 2022 fourth quarter, as show sizes continue to improve |
| We've got consistent rate increases, and as we make experiences better, we're able to provide a better experience and then charge more for it |
| And so we're working hard in that direction, and we're pleased with the 370-basis point increase in 2023 |
| Our consolidated adjusted EBITDA increased $30.9 million or 26.6%, on a 9.9% increase in revenue reflecting strong year-over-year growth at both Pursuit and GES on improved demand |
| Pursuit's full year adjusted EBITDA grew $24.7 million or 36.3% on a $51 million increase in revenue, reflecting the very high margin characteristics and operating leverage of the Pursuit business |
| I mean, we're quite confident and on track for our return to 30% margin in 2024 |
| A strong underlying performance more than offset the $74 million revenue impact from the sale of ON Services and the timing of major non-annual shows |
| Our full year income before other items, which excludes that gain, improved by $6.3 million, reflecting stronger EBITDA partially offset by higher interest expense and tax expense |
| And I can tell you that demand in '24, demand in '25 remains quite strong |
| And so the good news is we have demand from all over the world |
| We're really pleased with the new clients that we've picked up during the course of '23, and I feel there's momentum behind us and that will definitely help our overall growth for Spiro in '24 |
| We expect those numbers to continue to perform and we're in a good position as we move forward |
| With the meaningful full-year EBITDA growth we are anticipating, we also expect very strong operating cash flow particularly in the third quarter with Pursuit's seasonal contribution and GES' two largest non-annual shows taking place |
| Statement |
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| However, same-show square footage remains about 10% below pre-pandemic level |
| We entered 2023, knowing our revenue would be negatively impacted by about $80 million from the sale of ON services and the timing of non-annual events |
| Our full year net income attributable to Viad decreased $7.2 million, primarily due to the $19.6 million gain on the sale of ON Services in the prior year |
| When adjusting to exclude the favorable impact of non-annual shows and the loss of revenue from ON services which we sold in December of '22, GES' fourth quarter year-over-year revenue growth was about 20% |
| And you never want to benefit from someone else's misfortune |
| For Pursuit's seasonally slow first quarter, we expect adjusted EBITDA to be in the range of negative $12 million to negative $8 million as compared to negative $10.3 million in the 2023 first quarter |
| I also want to quickly comment on our expectations for tax expense, which, absent guidance from us is very challenging to model, given our jurisdictional tax positions |
| Without getting into specific guidance for future years, can you just give us a sense at a high level, I mean, assuming you've got a pretty meaningful revenue headwind in 2025, when you lose some of these non-annual shows |
| Toronto remains mired in some back and forth between the site and the city of Toronto |
| This is down from liquidity of $201.3 million at the end of the third quarter, reflecting operating cash outflows of $9.8 million and capital expenditures of $23.6 million |
| So you're not stuck if a country's economy falters, you're not stuck waiting for business from that country |
| I mean, looks like you for rounding to the nearest percentage point, you basically hit your 8% EBITDA margin target early, and looks like you're guiding to margins a little bit above that for this year |
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