10-K 1 vvi-10k_20171231.htm 10-K vvi-10k_20171231.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2017

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number: 001-11015

 

Viad Corp

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

36-1169950

State or other jurisdiction of

incorporation or organization

 

(I.R.S. Employer

Identification No.)

1850 North Central Avenue, Suite 1900

Phoenix, Arizona

 

85004-4565

(Address of principal executive offices)

 

(Zip Code)

(602) 207-1000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Name of each exchange

on which registered

Common Stock, $1.50 par value

 

New York Stock Exchange

 

Securities registered pursuant to Section 12(g) of the Act: None

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act.    Yes      No  

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.    Yes      No  

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.)    Yes      No  

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405)  is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  

Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check One):

 

Large accelerated filer

 

  

Accelerated filer

 

Non-accelerated filer

 

  

Smaller reporting company

 

 

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicated 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.     

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes      No  

The aggregate market value of the Common Stock (based on its closing price per share on such date) held by non-affiliates on the last business day of the registrant’s most recently completed second fiscal quarter (June 30, 2017) was approximately $948 million.

Registrant had 20,422,762 shares of Common Stock ($1.50 par value) outstanding as of January 31, 2018.

Documents Incorporated by Reference

A portion of the Proxy Statement for the Annual Meeting of Shareholders of Viad Corp, which is scheduled to be held on May 17, 2018, is incorporated by reference into Part III of this Annual Report.

 

 

 

 


INDEX

 

 

 

Page

Part I

 

 

Item 1.

Business

1

Item 1A.

Risk Factors

15

Item 1B.

Unresolved Staff Comments

18

Item 2.

Properties

19

Item 3.

Legal Proceedings

19

Item 4.

Mine Safety Disclosures

20

Other.

Executive Officers of the Registrant

20

Part II

 

 

Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

21

Item 6.

Selected Financial Data

23

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

24

Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

41

Item 8.

Financial Statements and Supplementary Data

42

Item 9.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

85

Item 9A.

Controls and Procedures

85

Item 9B.

Other Information

88

Part III

 

 

Item 10.

Directors, Executive Officers and Corporate Governance

89

Item 11.

Executive Compensation

89

Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

89

Item 13.

Certain Relationships and Related Transactions, and Director Independence

89

Item 14.

Principal Accounting Fees and Services

89

Part IV

 

 

Item 15.

Exhibits and Financial Statement Schedule

89

 

 

 

Item 16.

Form 10-K Summary

94

 

 

 

In this report, for periods presented, “we,” “us,” “our,” “the Company,” and “Viad Corp” refer to Viad Corp and its subsidiaries and affiliates.

 

 

 

 


 

 

PART I

Forward-Looking Statements

This Form 10-K 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. These forward-looking statements are not historical facts, but reflect our current estimates, projections, expectations, or trends concerning future growth, operating cash flows, availability of short-term borrowings, consumer demand, new or renewal business, investment policies, productivity improvements, ongoing cost reduction efforts, efficiency, competitiveness, strategic actions, acquisitions, the timing of new and damaged attractions openings, the sufficiency of our legal services, projections of 2018 revenue, show rotation, same-show rotation, segment operating income, attraction start-up costs, the realization of deferred tax assets, contributions to pension and postretirement benefit plans, legal expenses, tax rates and other tax matters, and foreign exchange rates. Actual results could differ materially from those discussed in the forward-looking statements. Viad’s businesses can be affected by a host of risks and uncertainties, many of which are beyond our control. 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 risks discussed in Item 1A, “Risk Factors,” included in this Annual Report on Form 10-K for the year ended December 31, 2017 (“2017 Form 10-K”). We disclaim and do not undertake any obligation to update or revise any forward-looking statement in this 2017 Form 10-K except as required by applicable law or regulation.

Item 1. Business

We are an international experiential services company with operations principally in the United States, Canada, the United Kingdom, continental Europe, and the United Arab Emirates. We are committed to providing unforgettable experiences to our clients and guests.

We operate through two main business groups:

 

GES is a world-class live event service provider to some of the most visible and influential events and global brands.

 

Pursuit is a collection of iconic natural and cultural destination travel experiences that enjoy perennial demand.

GES accounted for 87% of our 2017 consolidated revenue and 51% of our 2017 consolidated segment operating income(1). Pursuit accounted for 13% of our 2017 consolidated revenue and 49% of our 2017 consolidated segment operating income(1).

(1)

We define segment operating income as net income attributable to Viad before income (loss) from discontinued operations, corporate activities and eliminations, interest expense and interest income, income taxes, restructuring charges, impairment charges and recoveries, the reduction for income attributable to non-redeemable noncontrolling interest, and the addition for loss attributable to redeemable noncontrolling interest. Refer to Note 22 – Segment Information of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K) for a reconciliation of segment operating income to the most directly comparable GAAP measure.

1


 

GES is a global, full-service provider for live events that produces exhibitions, conferences, corporate events, and consumer events. GES offers a comprehensive range of live event services, from the design and production of compelling, immersive experiences that engage audiences and build brand awareness, to material handling, rigging, electrical, and other on-site event services. In addition, GES offers clients a full suite of audio-visual services from creative and technology to content and design, along with online tools powered by next generation technologies that help clients easily manage the complexities of their events. For nine years, GES’ National Servicenter® has been certified under the J.D. Power and Associates Certified Call Center ProgramSM, and for eight consecutive years, Ad Age has recognized GES as one of the nation’s largest experiential/event marketing agency networks. GES is included in Event Marketer magazine’s IT List as one of the top 100 event agencies in the industry.

GES’ clients include event organizers and corporate brand marketers. Event organizers schedule and run the event from start to finish. Corporate brand marketers include exhibitors and domestic and international corporations that want to promote their brands, services and innovations, feature new products, and build business relationships. GES serves corporate brand marketers when they exhibit at shows and when GES is engaged to manage their global exhibit program or produce their proprietary corporate events.

GES operates through two reportable business segments based on geography:

 

GES U.S. has a leading position in the U.S. with full-service operations in every major exhibition market, including Las Vegas, Nevada; Chicago, Illinois; Orlando, Florida; New York, New York; and Los Angeles, California.

 

 

GES International has operating facilities at many of the most active and popular international event destinations and venues, including seven cities in Canada, seven cities in the United Kingdom, two cities in Germany, two cities in the United Arab Emirates, two cities in the Netherlands, one city in Hong Kong, Switzerland, and Romania, and through these facilities offers full-service event operations across the United Kingdom, Europe, and the Middle East.

Markets Served

GES provides a full suite of services for event organizers and corporate brand marketers across four live event markets: Exhibitions, Conferences, Corporate Events, and Consumer Events (collectively, “Live Events”).

 

2


 

LIVE EVENT

 

PRIMARY PURPOSE

 

% GES 2017 REVENUE

 

Exhibitions

 

 

Facilitates business-to-business and business-to-consumer sales and marketing.

 

 

 

64%

 

Conferences

 

 

Facilitates attendee education. May also include an expo or trade show to further facilitate attendee education and to facilitate business-to-business and business-to-consumer sales and marketing.

 

 

 

23%

 

Corporate Events

 

 

Facilitates attendee education of sponsoring company’s products or product ecosystem.

 

 

 

11%

 

Consumer Events

 

 

Entertains, educates, or creates an experience, typically around a specific genre.

 

 

2%

 

3


 

Services Offered

GES offers a comprehensive range of services and innovative technology, including Core Services, Event Technology, and Audio-Visual, to event organizers and corporate brand marketers.

 

Core Services

 

For Live Events, GES provides official contracting services and products to event organizers and corporate brand marketers. Contracting services and products are provided primarily to Exhibitions and to a lesser degree to Conferences, Corporate Events, and Consumer Events. GES U.S. Core Services accounted for 57% of Viad’s 2017 consolidated revenue and 61% of Viad’s 2016 and 2015 consolidated revenue. GES International Core Services accounted for 19% of Viad’s 2017 and 2016 consolidated revenue and 23% of Viad’s 2015 consolidated revenue.

In general, GES provides the following exclusive and discretionary services and products to Live Event organizers and corporate brand marketers:

Exclusive Services

 

Discretionary Services

Event Organizers

 

Corporate Brand   Marketers

 

Corporate Brand Marketers

Event planning and production

 

Material handling

 

Creative design and strategy

Look and feel design

 

Electrical distribution

 

Integrated marketing and pre/post event communications

Layout and floor plan designs

 

Cleaning

 

Event surveys

Furnishings and carpet

 

Plumbing

 

Return on investment analysis

Show traffic analysis

 

Overhead rigging

 

Online management tools

Marketing and strategy

 

Booth rigging

 

Attendee/exhibit booth traffic analysis

Electrical distribution

 

 

 

Staff training

Cleaning

 

 

 

Logistics/transportation

Plumbing

 

 

 

Exhibits storage/refurbishment

Overhead rigging

 

 

 

Furnishings and carpet

Booth rigging

 

 

 

Installation and dismantling labor

 

 

 

 

Tradeshow program management

 

 

 

 

 

Exclusive Products

 

Discretionary Products

Event Organizers

 

 

 

Corporate Brand Marketers

Signage

 

 

 

Custom exhibit design/construction

Common area structures

 

 

 

Portable/modular exhibits and design

 

 

 

 

Graphics and signage

4


 

Under various agreements with Live Events organizers, GES is the official services contractor with the exclusive right to provide certain services to exhibitors participating in a Live Event. This gives exhibitors a single point of contact to facilitate a timely, safe, and efficient move-in/out of a Live Event and to facilitate an organized, professional, during-show experience. GES also competes with other service providers to sell discretionary services to exhibitors. Discretionary services include complete event program management, such as creative design, strategy, and planning to corporate brand marketers across all Live Events in which they participate.

Event Technology

 

GES offers a comprehensive range of event technology services, including event accommodation solutions, registration and data analytics, and event management tools.

Event accommodation solutions. GES U.S. offers end-to-end event accommodation services in North America. Event accommodations provide the unique potential to serve multiple Live Event participants through a single integrated service network. Event accommodations services include:

Researching and selection of local hotels

Negotiating and contracting

Room block management

Group reservation management

Rate integrity and monitoring

Marketing services

On-site services

Post-event reporting

Registration and data analytics. GES provides event registration and data analytic services including:

Registration and ticketing

Lead management

Reporting and analytics

Web-based enterprise-wide application

Software-as-a-service model or fully managed options

Attendee engagement

Digital collections

Event management tools. GES provides event management services including:

Online ordering capabilities

Sponsorship management tools

Content management systems

Live Event tracking

GES U.S. provides all three of the above event technology services which accounted for 2% of Viad’s 2017 consolidated revenue and 3% of Viad’s 2016 and 2015 consolidated revenue. GES International provides registration and data analytics and event management tools, which accounted for 1% of Viad’s 2017, 2016, and 2015 consolidated revenue.

 

Audio-Visual

 

GES offers a variety of high-impact multi-media services and technology across all Live Events. GES combines the science of innovative digital solutions with the latest audio-visual technology and superior service to create award-winning attendee engagements. GES expanded its audio-visual services through the 2016 acquisition of ON Event Services, LLC (“ON Services”), which enhances GES’ ability to gain market share in the Corporate Event markets in North America and enables GES to cross-sell its services and technology offerings. Audio-visual services include:

Video and lighting production

Digital studio services

Entertainment services and talent coordination

Projection mapping

Computer rental and support

GES U.S. audio-visual services accounted for 6% of Viad’s 2017 consolidated revenue, 3% of Viad’s 2016 consolidated revenue, and 1% of Viad’s 2015 consolidated revenue. GES International audio-visual services accounted for 2% of Viad’s 2017, 2016, and 2015 consolidated revenue.

5


 

Seasonality and Show Rotation

GES’ exhibition and event activity can vary significantly from quarter to quarter and year to year depending on the frequency and timing of shows: some shows are not held annually, and some shift between quarters. During 2017, GES U.S. reported its highest revenue during the first and second quarters. During 2016, GES U.S. reported its highest revenue during the second and third quarters. GES International generally reports its highest revenue during the second and fourth quarters. The following show rotation revenue metric refers to the net change in revenue from 2016 to 2017 due to show movement between quarters and years. Show rotation refers to shows that occur less frequently than annually, as well as annual shows that shift quarters from one year to the next.

E

Competition

In the Live Events industry, GES generally competes across all classes of services and all markets on the basis of discernible differences, value, quality, price, convenience, and service. GES has a competitive advantage through its worldwide network of resources, history of serving as an extension of clients’ teams, experienced and knowledgeable personnel, client-focus, creativity, reliable execution, proprietary technology platforms, and financial strength. All known U.S. competitors and most international competitors are privately held companies that provide limited public information regarding their operations. GES’ primary competitor within its Core Services is The Freeman Company (a privately-held, U.S.-headquartered company); however, there is substantial competition from a large number of service providers in GES’ other service offerings.

Growth Strategy

GES is committed to become the preferred global, full-service provider for Live Events. GES holds a leading market position in Exhibitions and is pursuing a focused and disciplined growth strategy with the goal of expanding its market share in the currently under-penetrated Conferences, Corporate Events, and Consumer Events markets. GES has uniquely combined the art of high-impact creativity, service, and expertise with the science of easy-to-use technology, strategy, and worldwide logistics to help clients gain a greater return from their events and enhance the exhibitor experience.

 

Global Reach. Leverage global capabilities and large customer base to drive continued growth in new services and other Live Events.

 

Full-Service Provider. Growth of adjacent services to create a unique and integrated offering to deepen client relationships, expand client base, and increase share of total event spend.

 

Live Events. Penetration into other live events to extend industry leadership and leverage capabilities.

With our recent acquisitions, GES made significant progress toward creating the most comprehensive suite of services for the Live Events industry, which enhanced overall competitiveness, facilitated growth in under-penetrated areas, and formed a basis for a data platform. We continue to pursue opportunities to acquire businesses with proven products and services that complement, enhance, or expand current businesses or offer growth opportunities.

6


 

Recent Developments of GES

 

Poken Acquisition. In March 2017, we completed the acquisition of the Poken event engagement technology, a leading cloud-based visitor engagement and measurement platform. The Poken platform offers a seamless ecosystem of tools that enable digital document collection (through its patented “Touch and Glow” technology), visitor-to-visitor engagement, gamification, and metrics reporting.

 

Cross-selling opportunities. GES is effectively positioned to cross-sell an increasingly comprehensive suite of service offerings with a convenient approach to service delivery that differentiates GES from its competition.

 

Registration and data analytic services entrance in the Asia markets. In early 2017, GES officially launched registration and data analytic services in the Asia market with a Hong Kong office.


7


 

Pursuit is a collection of iconic natural and cultural destination travel experiences in North America that showcase the best of Banff, Jasper, Waterton Lakes, Glacier, Denali, and Kenai Fjords National Parks, and Vancouver, Canada. Through Pursuit’s collection of unique hotels and lodges, world-class recreational attractions, and ground transportation services, it connects guests to iconic places through unforgettable, inspiring experiences. Pursuit draws its guests from major markets, including Canada, the United States, China, the United Kingdom, Australia/New Zealand, Asia Pacific, and Europe. Pursuit markets directly to consumers, as well as through distribution channels that include tour operators, tour wholesalers, destination management companies, and retail travel agencies and organizations. Pursuit comprises the following collections:

Banff Jasper Collection

 

Brewster Travel Canada, which is marketed as the Banff Jasper Collection, is a leading travel and tourism provider in the Canadian Rockies in Alberta, Canada with two lodging properties in Banff National Park, one lodging property in Jasper National Park, five world-class recreational attractions, food and beverage services, retail operations, sightseeing and transportation services.

 

Alaska Collection

 

The Alaska Collection is a leading travel and tourism provider in Alaska with two lodging properties and a sightseeing excursion in Denali National Park and Preserve, a lodge in Talkeetna, Alaska’s top-rated wildlife and glacier cruise, and two lodging properties located near Kenai Fjords National Park. The Alaska Collection also provides food and beverage services and retail operations.

 

Glacier Park Collection

 

 

Glacier Park, Inc., which is marketed as the Glacier Park Collection, is an operator of seven lodging properties, 12 retail shops, and 11 dining outlets in and around Glacier National Park in Montana, one of the most visited national parks in the United States, and Waterton Lakes National Park in Alberta, Canada, with a leading share of rooms in that market. Glacier Park, Inc. is an 80% owned subsidiary of ours.

 

FlyOver

 

FlyOver Canada, located in Vancouver, British Columbia, is a recreational attraction that provides a virtual flight ride experience that combines motion seating, spectacular media, and visual effects including wind, scents, and mist to give the unforgettable experience of flying across Canada.

FlyOver Iceland is a recreational attraction currently being built in Reykjavik, Iceland that will provide a virtual flight ride experience over some of Iceland’s most spectacular scenery and natural wonders with the same effects as FlyOver Canada. The new attraction is expected to open in 2019.

 

8


 

Pursuit comprises four lines of business: Hospitality, including food and beverage services and retail operations; Attractions, including food and beverage services and retail operations; Transportation; and Travel Planning. These four lines of business work together, driving economies of scope and meaningful scale in and around the iconic destinations of Banff, Jasper, and Waterton Lakes National Parks and Vancouver in Canada, and Glacier, Denali, and Kenai Fjords National Parks in the United States.

 

 

Hospitality (# of rooms)

 

Attractions

 

Transportation (2)

 

Travel Planning (2)

 

Banff Jasper Collection

 

 

Elk + Avenue Hotel (164)

Glacier View Inn (32)

Mount Royal Hotel (133) (1)

 

 

 

Banff Gondola

Banff Lake Cruise

Columbia Icefield

  Glacier Adventure

Glacier Skywalk

Maligne Lake Tours

 

 

 

Airporter Services

Charter Motorcoach

   Services

Sightseeing Tours

 

 

 

Corporate Event

   Management Services

Explore Rockies

Activity Booking Centers

Alaska Collection

 

Denali Backcountry Lodge (42)

Denali Cabins (46)

Kenai Fjords Wilderness Lodge (8)

Seward Windsong Lodge (180)

Talkeetna Alaska Lodge (212)

 

 

Kenai Fjords Tours

 

Denali Backcountry Adventure

 

 

Travel Planning Services

Glacier Park Collection

 

Apgar Village Lodge (48)

Glacier Park Lodge (162)

Grouse Mountain Lodge (145)

Motel Lake McDonald (27)

Prince of Wales Hotel (86)

St. Mary Lodge  (127)(3)

West Glacier Motel & Cabins (32)

 

 

 

 

 

 

 

FlyOver

 

 

 

FlyOver Canada –

  Vancouver

FlyOver Iceland –

  Reykjavik(4)

 

 

 

 

(1)

The Mount Royal Hotel was damaged by a fire on December 29, 2016, and was closed for reconstruction during 2017. We anticipate re-opening the hotel in mid-year 2018. The number of rooms available at the hotel will decrease from 135 to 133 after the renovation is complete.

(2)

During 2017, we completed the previously announced downsizing of the Banff Jasper Collection’s third party tour and travel products and exited summer season charter transportation services.

(3)

During 2017, the Glacier Park Collection added ten tiny homes to the St. Mary Lodge property bringing the total number of rooms from 117 to 127. See “Recent Pursuit Developments” for further discussion.

(4)

In November 2017, we announced the expansion of our virtual flight ride concept into Iceland’s capital city of Reykjavik. We expect the new attraction to be open in 2019.

9


 

 

Hospitality

Pursuit provides lodging accommodations, food and beverage services, and retail operations through its collection of unique hotels and lodges varying from hikers’ cabins to grand and historic lodges.

Mount Royal Hotel and Elk + Avenue Hotel are located in the heart of Banff National Park in downtown Banff, Alberta, Canada.

 

Glacier View Inn is located on the Columbia Icefield between Lake Louise and Jasper in Jasper National Park.

 

Denali Backcountry Lodge is located in the heart of the Denali National Park.

 

Denali Cabins are located near the entrance to the Denali National Park.

 

Kenai Fjords Wilderness Lodge is located on a private island in Resurrection Bay adjacent to the Kenai Fjords National Park.

 

Seward Windsong Lodge is located near Kenai Fjords National Park in Seward, Alaska.

 

Talkeetna Alaskan Lodge is located in Talkeetna, Alaska on the south side of Denali National Park.

 

Apgar Village Lodge and Motel Lake McDonald are located inside Glacier National Park.

 

Glacier Park Lodge is located in East Glacier, Montana.

 

Grouse Mountain Lodge is located near Glacier National Park in Whitefish, Montana.

 

Prince of Wales Hotel is located in Waterton Lakes National Park, Alberta, Canada.

 

St. Mary Lodge is located outside the east entrance of Glacier National Park in St. Mary, Montana.

 

West Glacier Motel & Cabins is located outside the west entrance of Glacier National Park.

 

Attractions

Pursuit owns and operates the following attractions in the Canadian Rocky Mountains, Vancouver, and in Alaska:

Banff Gondola transports visitors to an elevation of over 7,000 feet above sea level to the top of Sulphur Mountain in Banff, Alberta, Canada offering an unobstructed view of the Canadian Rockies and overlooking the town of Banff and the Bow Valley. The Banff Gondola has been honored with two Top Project Awards from Alberta Construction Magazine. The Banff Gondola’s winning categories include the People’s Choice Award in 2016 and the Commercial Award (Under $50 Million) in 2016. The Banff Gondola is currently rated by Trip Advisor as the #1 “Things to do in Banff” and received the Trip Advisor Certificate of Excellence.

 

 

Banff Lake Cruise provides guests a unique sightseeing experience through interpretive boat cruises on Lake Minnewanka in the Canadian Rockies. The Banff Lake Cruise operations are located adjacent to the town of Banff and include boat tours, small boat rentals, and charter fishing expeditions.

10


 

Columbia Icefield Glacier Adventure is a tour of the Athabasca Glacier on the Columbia Icefield, and provides guests the experience to view one of the largest accumulations of ice and snow south of the Arctic Circle. Guests ride in a giant “Ice Explorer,” a unique vehicle specially designed for glacier travel. The Columbia Icefield Glacier Adventure received the Trip Advisor Certificate of Excellence.

 

Glacier Skywalk is a 1,312-foot guided interpretive walkway with a 98-foot glass-floored observation area overlooking the Sunwapta Valley, in close proximity to our Columbia Icefield Glacier Adventure attraction in Jasper National Park, Alberta, Canada. Since opening in 2014, the Glacier Skywalk has had robust visitor traffic. It continues to win awards and receive international recognition for its innovative design and environmentally sound architecture, including the prestigious Governor General’s Medals in Architecture in 2016.

 

FlyOver Canada provides a virtual flight ride experience that showcases some of Canada’s most awe-inspiring scenery from coast to coast. The state-of-the-art, multi-sensory experience combines motion seating, spectacular media, and special effects, including wind, scents, and mist, to provide a true flying experience for guests. FlyOver Canada is ideally located in downtown Vancouver. FlyOver Canada is rated by Trip Advisor as the #1 “Fun & Games in Vancouver” and received the Trip Advisor Certificate of Excellence.

 

FlyOver Iceland is a recreational attraction currently being built in Reykjavik, Iceland. Guests will experience an exhilarating virtual flight ride over some of Iceland’s most spectacular scenery and natural wonders with the same effects as FlyOver Canada. We expect the new attraction to open in 2019.

 

 

 

 

 

Kenai Fjords Tours is a leading Alaska wildlife and glacier day cruise, offering guests unforgettable sights of towering glaciers, humpback and grey whales, orcas, arctic birdlife, sea lions, seals, and porpoises of Kenai Fjords National Park. Tours range from a few hours to full days, with some tours including a full meal of wild Alaska salmon, prime rib, and Alaskan King Crab on Fox Island. Kenai Fjords Tours has received the Trip Advisor Certificate of Excellence.

 

11


 

Maligne Lake Tours provides interpretive boat tours and related services at Maligne Lake, the largest lake in Jasper National Park, Alberta, Canada. Maligne Lake Tours has seven tour boats, a marina and day lodge that offers food and beverage and retail services, an historic chalet complex and boat house that offers canoes, kayaks, and rowboats for rental. Maligne Lake Tours received the Trip Advisor Certificate of Excellence.

 

Transportation

 

 

 

The Banff Jasper Collection’s transportation operations include sightseeing tours, airport shuttle services, and seasonal charter motorcoach services. The sightseeing services include seasonal half- and full-day tours from Calgary, Banff, Lake Louise, and Jasper, Canada and bring guests to the very best parts of Banff and Jasper National Parks. The charter business operates a fleet of luxury motorcoaches, available for groups of any size, for travel throughout the Canadian provinces of Alberta and British Columbia during the winter months. The Alaska Collection offers a unique sightseeing tour 92 miles deep into Denali National Park.

 

 

 

Travel Planning

 

 

 

 

The Banff Jasper Collection offers a full suite of corporate and event management services for meetings, conferences, incentive travel, sports, and special events. Event-related service offerings include staffing, off-site events, tours/activities, team building, accommodations, event management, theme development, production, and audio-visual services. The Banff Jasper Collection also owns and operates eight Explore Rockies activity booking centers throughout Banff and Jasper National Parks and Calgary, Alberta. In 2017, the Banff Jasper Collection completed phasing out the previously announced third party package tour and travel products to align with its goal of delivering premium experiences and improving its overall profit margin. The Alaska Collection provides complete travel planning services throughout Alaska.

Seasonality

Pursuit experiences peak activity during the summer months. During 2017, 87% of Pursuit’s revenue was earned in the second and third quarters.

Competition

Pursuit generally competes on the basis of location, uniqueness of facilities, service, quality, and price. Competition exists both locally and regionally across all four lines of business. The hospitality business has a large number of competitors and competes for leisure travelers (both individual and tour groups) across the United States and Canada. Pursuit’s competitive advantage is its distinctive attractions and iconic destinations.

12


 

Growth Strategy

Pursuit remains focused on delivering inspiring and unforgettable experiences in iconic locations while growing and enhancing its unique portfolio of integrated tourism assets through its Refresh-Build-Buy growth initiatives.

 

Refresh. Refresh assets and processes to optimize market position and maximize returns.

 

Build. Build new assets that create new revenue streams with economies of scale and scope.

 

Buy. Buy strategic assets that drive economies of scale and scope with strong returns.

We continue to search for opportunities to acquire or to build high return tourism assets in iconic natural and cultural destinations that enjoy perennial demand, bring meaningful scale and market share, and offer cross-selling advantages with a combination of attractions and hotels.

Recent Pursuit Developments

 

Mount Royal Hotel. On December 29, 2016, the Mount Royal Hotel was damaged by fire and closed. In July 2017, we resolved our property and business interruption insurance claims related to the fire for $36.3 million. We allocated $2.2 million to an insurance receivable, $29.3 million was recorded as an impairment recovery (partially offset by impairment charges of $0.2 million) related to construction costs to re-open the hotel, $2.5 million was recorded as a business interruption gain for the recovery of lost profits, $1.3 million was recorded as contra-expense to offset non-capitalizable costs incurred, and the remaining $1.0 million was recorded as deferred revenue that will be recognized over the periods the business interruption losses are actually incurred. Restorations and improvements will provide an elevated guest experience to room finishes and furnishings, lobby and lounge areas, exterior appearance, heating/cooling, sound insulation, and building systems. We anticipate re-opening the hotel in mid-year 2018.

 

Expansion of FlyOver Concept. On November 3, 2017, we acquired the controlling interest (54.5% of the common stock) in Esja Attractions ehf. (“Esja”). Esja, a private Iceland corporation is developing and will operate Pursuit’s new FlyOver Iceland attraction. This attraction expands our virtual flight ride theater concept into Iceland’s capital city of Reykjavik. Modeled after our highly successful FlyOver Canada attraction, FlyOver Iceland will provide guests an exhilarating virtual flight experience over some of Iceland’s most spectacular scenery and natural wonders. The new attraction is expected to open in 2019.

 

Tiny Home Village. On July 15, 2017, we added ten tiny homes to the St. Mary Lodge property as part of the Glacier Park Collection. The tiny home’s design embraces a number of eco-forward elements, such as a fresh water/gray water system and pint-sized, energy-efficient appliances. Elements of luxury are woven into the design. Homes can accommodate up to four guests, with a sliding barn-style door separating a compact sleeping area from the cozy living area. 

 

RV and Cabin Park Development. In 2017, we began developing approximately 100 acres of undeveloped land adjacent to Glacier National Park that we acquired in connection with our 2014 purchase of the West Glacier properties. The new development will include a new RV and cabin park with 102 RV slips, 20 guest cabins, five employee housing cabins, guest registration, and a laundromat. Our site is ideally located at the Glacier Park entrance. We expect half of the new RV and Cabin Park to open during the 2019 season with the remainder opening for the 2020 season.

Financial information for our reportable segments and geographic areas is included in Note 22 – Segment Information of the Notes to Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

Intellectual Property

Our intellectual property rights (including trademarks, patents, copyrights, registered designs, technology, and know-how) are material to our business.

We own or have the right to use numerous trademarks and patents in many countries. Depending on the country, trademarks remain valid for as long as we use them, or as long as we maintain their registration status. Trademark registrations are generally for renewable, fixed terms. We also have patents for current and potential products. Our patents cover inventions ranging from a modular structure having a load-bearing surface we use in our event and exhibition services, to a surface-covering installation tool and method that reduces our labor costs and improves worker safety. Our U.S. issued utility patents extend for 20 years from the patent application filing date; and our U.S. issued design patents are currently granted for 14 years from the grant date. We also have an extensive design library. Many of the designs have copyright protection and we

13


 

have also registered many of the copyrights. In the U.S., copyright protection is for 95 years from the date of publication or 120 years from creation, whichever is shorter.  While we believe that certain of our patents, trademarks, and copyrights have substantial value, the loss of any one of them would not have a material adverse effect on our financial condition or results of operations.

Our Trademarks

Our U.S. registered trademarks and trademarks pending registration, include Global Experience Specialists & design®, GES®, GES Servicenter®, GES National Servicenter®, GES MarketWorks®, The Art and Science of Engagement®, Trade Show Rigging TSR®, TSE Trade Show Electrical & design®, Earth Explorers®, Compass Direct®, ethnoMetrics®, eXPRESSO®, FIT®, ON Services, ON Site Audio Visual & design, FLYOVER®, eco-sense®, ONPEAK®, Above Banff®, Alaska Denali Travel®, Alaska Denali Escapes®, Alaska Heritage Tours®, Kenai Fjords Tours & design®, Kenai Fjords Wilderness Lodge®, Seward Windsong Lodge & design®, Talkeetna Alaskan Lodge®, Explore Rockies®, Denali Backcountry Adventure®, Denali Backcountry Lodge®, and Denali Cabins®. We also own or have the right to use many registered trademarks and trademarks pending registration outside of the United States, including GES®, ShowTech®, Poken®, Visit, Blitz, Brewster Inc. & design®, Brewster Attractions Explore & design®, Brewster Hospitality Refresh & design®, Glacier Skywalk®, Above Banff®, Explore Rockies®, FLYOVER®, Soaring Over Canada®, Elk + Avenue Hotel®, Brewster Epic Summer Pass®, and escape.connect.refresh.explore®.

Government Regulation and Compliance

Compliance with legal requirements and government regulations represents a normal cost of doing business. The principal rules and regulations affecting our day-to-day business relate to transportation (such as regulations promulgated by the U.S. Department of Transportation and its state counterparts), employees (such as regulations implemented by the Occupational Safety and Health Administration, equal employment opportunity laws, guidelines implemented pursuant to the Americans with Disabilities Act, and general federal and state employment laws), unionized labor (such as guidelines imposed by the National Labor Relations Act), and U.S. and Canadian regulations relating to national parks (such as regulations established by Parks Canada, the U.S. Department of the Interior, and the U.S. National Park Service).

Some of our current and former businesses are subject to U.S. federal and state environmental regulations, including laws enacted under the Comprehensive Environmental Response, Compensation and Liability Act, or our state law counterparts. Compliance with federal, state and local environmental, health and safety provisions, including, but not limited to, those regulating the discharge of materials into the environment and other actions relating to the environment, have not had, and are not expected to have, a material effect on our capital expenditures, competitive position, financial condition or results of operations.

Employees

We had the following number of employees as of December 31, 2017:

 

 

 

Number of

Employees

 

 

Regular Full-Time

Employees Covered by

Collective Bargaining

Agreements

 

GES

 

 

3,092

 

 

 

1,142

 

Pursuit

 

 

365

 

 

 

41

 

Viad Corporate

 

 

64

 

 

 

 

Total

 

 

3,521

 

 

 

1,183

 

We believe that relations with our employees are good and that collective-bargaining agreements expiring in 2018 will be renegotiated in the ordinary course of business without a material adverse effect on our operations.

We are governed by a Board of Directors comprised of seven non-employee directors and one employee director, and we have an executive management team consisting of four executive officers.

Financial Information about Segments and Geographic Areas

Refer to Note 22 – Segment Information of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K) for segment financial information.

14


 

Available Information

We were incorporated in Delaware in 1991. Our common stock trades on the New York Stock Exchange under the symbol “VVI.”

Our website address is www.viad.com. All of our SEC filings, including our Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, are available free of charge on our website as soon as reasonably practicable after we electronically file that material with, or furnished it to, the SEC. The information contained on our website is neither a part of, nor incorporated by reference into, this 2017 Form 10-K.

Our investor relations website is www.viad.com/investors/investor-center/default.aspx and includes key information about our corporate governance initiatives, including our Corporate Governance Guidelines, our Board of Directors committee charters, our Code of Ethics, and information concerning our Board members and how to communicate with them.

Item 1A. Risk Factors

Our operations and financial results are subject to known and unknown risks. As a result, past financial performance and historical trends may not be reliable indicators of our future performance.

Completed acquisitions may not perform as anticipated or be integrated as planned. We regularly evaluate and pursue opportunities to acquire businesses that complement, enhance, or expand our current business, or offer growth opportunities. Our acquired businesses might not meet our financial and non-financial expectations or yield anticipated benefits. Our success depends, in part, on our ability to conform controls, policies and procedures, and business cultures; consolidate and streamline operations and infrastructures; identify and eliminate redundant and underperforming operations and assets; manage inefficiencies associated with integration of operations; and retain the acquired business’ key personnel and customers. Moreover, our acquisition activity potentially increases our debt, subjects us to new regulatory requirements, distracts our senior management and employees, and exposes us to unknown liabilities or contingencies that we fail to, or are unable to identify prior to closing. If our acquisitions cause us to make changes to our business strategy or if external conditions adversely affect our business operations, we may also be required to record an impairment charge to goodwill or intangible assets. Any of these risks could materially and adversely affect our business, product and service sales, financial condition, and results of operations.

We depend on our large exhibition event clients to renew their service contracts and on our exclusive right to provide those services. During 2017, no single client accounted for more than 6% of our consolidated revenue. However, GES has a number of large exhibition event organizers and large customer accounts. If any of these large clients do not renew their service contracts, our results of operations could be materially adversely affected.

Moreover, when event organizers hire GES as the official services contractor, they also grant GES an exclusive right to perform electrical, plumbing services, and other services (the “Event Services”) at the exhibition facility. However, exhibition facilities are under increasing financial pressure to in-source Event Services (either by performing the services themselves or by hiring a separate service provider) as a result of conditions generally affecting their industry, such as an increased supply of exhibition space. If a large number of exhibition facilities choose to in-source Event Services, GES will lose the ability to provide Event Services despite being hired as the official services contractor, and our results of operations could be materially and adversely affected.

Our business is relationship driven. Our GES business is heavily focused on client relationships, and, specifically, on having close collaboration and interaction with our clients. To be successful, our account team must be able to understand a client’s desires and expectations in order to provide top-quality service. If we lose a key member of our account team, we could also lose customers and our results of operations could be materially and adversely affected.

We operate in highly competitive industries. We are engaged in a number of highly competitive industries. Competition in the Live Events industry and the exhibits and experiential environments industries is driven by price and service quality, among other factors. To the extent competitors seek to gain or retain their market presence through aggressive underpricing strategies, we may be required to lower our prices and rates to avoid the loss of related business, thereby adversely affecting our results of operations. In addition, if we are unable to anticipate and respond as effectively as competitors to changing business conditions, including new technologies and business models, we could lose market share to our competitors. Our inability to meet the challenges presented by the competitive environment could materially and adversely affect our results of operations.

15


 

Travel industry disruptions, particularly those affecting the hotel and airline industries, could adversely affect our business. Our business depends largely on the ability and willingness of people, whether exhibitors, exhibition attendees, or others, to travel. Factors adversely affecting the travel industry, and particularly the airline and hotel industries, generally also adversely affect our business and results of operations. Factors that could adversely affect the travel industry include high or rising fuel prices, increased security and passport requirements, weather conditions, airline accidents, and international political instability and hostilities. Any of these factors, or other unexpected events that affect the availability and pricing of air travel and accommodations, could materially and adversely affect our business and results of operations.

Transportation disruptions and increases in transportation costs could adversely affect our business and results of operations. GES relies on independent transportation carriers to send materials and exhibits to and from exhibition, warehouse, and customer facilities. If our customers and suppliers are unable to secure the services of those independent transportation carriers at favorable rates, it could materially and adversely affect our business and results of operations. In addition, disruption of transportation services due to weather-related problems, labor strikes, lockouts, or other events could adversely affect our ability to supply services to customers and could cause the cancellation of exhibitions, which could materially and adversely affect our business and results of operations.

The seasonality of our business makes us particularly sensitive to adverse events during peak periods. Our GES exhibition and event activity varies significantly because it is based on the frequency and timing of shows, many of which are not held each year and which may shift between quarters. The peak activity for our Pursuit business is during the summer months. Consequently, during 2017, 87% of Pursuit’s revenue was earned in the second and third quarters. If adverse events or conditions occur during these peak periods our results of operations could be materially and adversely affected.

Terrorist attacks, natural disasters, or other catastrophic events could negatively affect our business. The occurrence of catastrophic events ranging from natural disasters (such as hurricanes, fires, and floods), health epidemics or pandemics, acts of war or terrorism, accidents involving our travel offerings or experiences, or the prospect of these events could disrupt our business. Such catastrophic events could have a negative impact on GES’ production facilities, preventing us from timely completing exhibit fabrication and other projects for customers. They could also cause a cancellation of exhibitions and other events held in public venues or disrupt the services we provide to our customers at convention centers, exhibition halls, hotels, and other public venues. Such catastrophic events could also have an adverse impact on Pursuit, which is heavily dependent on the ability and willingness of its guests to travel. Pursuit guests tend to delay or postpone vacations if natural conditions differ from those that typically prevail at competing lodges, resorts and attractions, and catastrophic events could impede the guests’ ability to travel, interrupt our business operations, and/or cause damage to our properties. In addition, unfavorable media attention, or negative publicity, in the wake of a catastrophic event could damage our reputation or reduce the demand for our services. If the conditions arising from such events persist or worsen, they could materially and adversely affect our results of operations and financial condition.

We are vulnerable to deterioration in general economic conditions. Our business is sensitive to fluctuations in general economic conditions that affect the cost of materials and operating supplies. The success of our GES business largely depends on the number of exhibitions held, the size of exhibitors’ marketing expenditures, and on the strength of particular industries in which exhibitors operate. The number and size of exhibitions generally decrease when the economy weakens. We also suffer from reduced spending for our services because many exhibitors’ marketing budgets are partly discretionary, and are frequently among the first expenditures reduced when economic conditions deteriorate. Consequently, marketing expenditures often are not increased until economic conditions improve. Revenue from our Pursuit operation depends largely on the amount of disposable income that consumers have available for travel and vacations. This amount decreases during periods of weak general economic conditions. Any of these risks could materially and adversely affect our business, product sales, financial condition, and results of operations.

Recent U.S. tax legislation may materially and adversely affect our financial condition, results of operations, and cash flows. The Tax Cuts and Jobs Act (the “Tax Act”), enacted in late 2017, makes significant changes to U.S. tax laws and includes numerous provisions that could affect our business. For instance, as a result of lower corporate tax rates, the Tax Act tends to reduce both the value of deferred tax assets and the amount of deferred tax liabilities. It also limits interest rate deductions and the amount of net operating losses that can be used each year and alters the expensing of capital expenditures. Other provisions have tax consequences for our international operations. The Tax Act is unclear in certain respects and will require interpretations and implementing regulations by the Internal Revenue Service, as well as state tax authorities. The Tax Act could also be subject to amendments and technical corrections, any of which could lessen or increase the adverse impacts on our business operations. The accounting treatment of these tax law changes is complex, and some of the changes may affect both current and future periods. Others will primarily affect future periods. As we have discussed elsewhere in this Report on Form 10-K, we believe our analysis and computations of the tax effects of the Tax Act on financial results is substantially, but not entirely, complete. Consistent with guidance from the SEC, our financial statements reflect our estimates of the tax effects of the Tax Act on our business. Although we believe these estimates are reasonable, they are

16


 

provisional and may be adjusted prior to the end of 2018. Any such adjustments could affect our current or future financial statements, or both. We continue to examine the impact of this tax reform legislation, and as its overall impact is uncertain, we note that the Tax Act could adversely affect our business and financial condition.

We are subject to currency exchange rate fluctuations. We have operations outside of the U.S. primarily in Canada, the United Kingdom, the Netherlands, Germany, and to a lesser extent, in certain other countries. During 2017, GES International and Pursuit’s international operations accounted for approximately 30% of our consolidated revenue and 58% of our segment operating income. Consequently, a significant portion of our business is exposed to currency exchange rate fluctuations. Our financial results and capital ratios are sensitive to movements in currency exchange rates because a large portion of our assets, liabilities, revenue, and expenses must be translated into U.S. dollars for reporting purposes. The unrealized gains or losses resulting from the currency translation are included as a component of accumulated other comprehensive income (loss) in our consolidated balance sheets. As a result, significant fluctuations in currency exchange rates could result in material changes to the net equity position we report in our consolidated balance sheets. We do not currently hedge equity risk arising from the translation of non-U.S. denominated assets and liabilities.

Our participation in multi-employer pension plans could substantially increase our pension costs. We sponsor a number of defined benefit plans for our U.S. and Canada-based employees. We are obligated to contribute to multi-employer pension plans under collective-bargaining agreements covering our union-represented employees. We contributed $26.6 million in 2017 and $25.8 million in 2016 to those multi-employer pension plans. These multi-employer plans are managed by third-party boards of trustees. Based upon the information we receive from plan administrators, we believe that several of those multi-employer plans are underfunded. The Pension Protection Act of 2006 requires us to reduce the underfunded status over defined time periods. Moreover, we would be required to make additional payments of our proportionate share of a plan’s unfunded vested liabilities if a plan terminates, or other contributing employers withdraw, due to insolvency or other reasons, or if we voluntarily withdraw from a plan. At this time, we cannot determine with any certainty the amount of additional funding, if any, we could be required to make to those plans. However, significant plan contribution increases, could materially and adversely affect our consolidated financial condition, results of operations, and cash flows. Refer to Note 17 – Pension and Postretirement Benefits of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K) for further information.

Union-represented labor increases our risk of higher labor costs and work stoppages. A significant portion of our employees are unionized. We have approximately 100 collective-bargaining agreements, and we are required to renegotiate approximately one-third of those each year. If we increase wages or benefits as a result of labor negotiations, either our operating margins will suffer, or we could increase the cost of our services to our customers, which could lead those customers to turn to other vendors with lower prices. Either event could materially and adversely affect our business and results of operations.

Additionally, if we are unable to reach an agreement with a union during the collective-bargaining process, the union may strike or carry out other types of work stoppages. If that happens, we might be unable to find substitute workers with the necessary skills to perform many of the services, or we may incur additional costs to do so, both of which could materially and adversely affect our business and results of operations.

We are vulnerable to cybersecurity attacks and threats. We regularly collect and process credit, financial, and other personal, sensitive, and confidential information from individuals and entities who attend or participate in events and exhibitions that we produce, or who visit our attractions and other offerings. In addition, our devices, servers, computer systems, and business systems are vulnerable to cybersecurity risk, including cyberattacks, or we may be the target of email scams that attempt to acquire personal information and company assets. Despite our efforts to protect ourselves with insurance, and create security barriers to such threats, including regularly reviewing our systems for vulnerabilities and continually updating our protections, we might not be able to entirely mitigate these risks. Our failure to effectively prevent, detect, and recover from the increasing number and sophistication of information security threats could lead to business interruptions, delays or loss of critical data, misuse, modification, or destruction of information, including trade secrets and confidential business information, reputational damage, and third-party claims, any of which could adversely and materially affect our results of operations.

Laws and regulations relating to the handling of personal data could result in increased costs, legal claims, or fines. We store and process personally identifiable information from our customers, employees, and third parties with whom we have business relationships. Legal requirements relating to the collection, storage, handling, and transfer of personal data continue to evolve and could lead to burdensome or inconsistent requirements affecting the location and movement of our customer and internal employee data as well as the management of the data. For example, in July 2016, the EU and the U.S. agreed on a mechanism for companies to transfer data from EU member states to the U.S. This framework, called the Privacy Shield, is intended to address shortcomings identified by the European Court of Justice in a predecessor mechanism.

17


 

The Privacy Shield and other mechanisms are currently subject to challenges in European courts, which may lead to uncertainty about the legal basis for data transfers across the Atlantic. Also, in May 2018, the EU’s new General Data Protection Regulation (GDPR) will replace the existing EU Data Protection Directive, and it will have a significant impact on how businesses can collect and process the personal data of EU individuals. The GDPR includes a requirement for businesses to self-report personal data breaches to the relevant supervisory authority and, under certain circumstances, to the affected data subjects. It also gives additional rights to individuals whose data are processed, including the “right to erasure” (also commonly known as the right to be forgotten) by having their records erased and the right to data portability. Compliance with the myriad requirements could involve changes in our services, business practices, or internal systems that could likely increase our costs, lower revenue, reduce efficiency, or make it more difficult to compete with Non-U.S.-based firms. Our failure to comply with existing or new rules could result in significant penalties or orders to stop the alleged noncompliant activity, litigation, adverse publicity, or could cause our customers to lose trust in our services. In addition, if the third parties we work with violate applicable laws, contractual obligations, or suffer a security breach, those violations could also put us in breach of our obligations under privacy laws and regulations. Any of these risks could materially and adversely affect our business and results of operations.

New capital projects may not be commercially successful. From time to time, we pursue capital projects, such as our current efforts to upgrade some of our Pursuit offerings in order to seize opportunities that complement, enhance, and expand our business. Capital projects are subject to a number of risks, including unanticipated delays, cost overruns, and the failure to achieve established financial and strategic goals, as well as additional risks specific to a project. The occurrence of any of these events could prevent a new capital project from performing in accordance with our commercial expectations and could materially and adversely affect our business and results of operations.

Show rotation affects our profitability and makes comparisons between periods difficult. GES results are largely dependent upon the frequency, timing, and location of exhibitions and events. Some large exhibitions are not held annually (they may be held once every two or three years or longer) or may be held at different times of year from when they were previously held. In addition, the same exhibition may change locations from year to year resulting in lower margins if the exhibition shifts to a higher-cost location. Any of these factors could cause our results of operations to fluctuate significantly from quarter to quarter or from year to year, making periodic comparisons difficult.

The United Kingdom’s exit from the European Union could adversely affect our business. We operate substantial parts of our EU businesses from U.K-based entities. The June 23, 2016 U.K. referendum resulted in a determination that the U.K. should exit the EU. In March 2017, the U.K. government initiated the exit process under Article 50 of the Treaty of the EU, commencing a period of up to two years for the United Kingdom and the other EU member states to negotiate the terms of the withdrawal. The uncertainty surrounding the timing, terms and consequences of the U.K.’s exit could adversely impact customer and investor confidence, result in additional market volatility and adversely affect our businesses and our results of operations and financial condition. Once the U.K. exits from the EU, the regulatory and legal environment that would then govern our U.K. operations will depend on, in certain respects, the nature of the arrangements agreed to between the U.K., the EU, and other trading partners. It is likely that changes to our legal entity structure and operations in Europe will be required as a result of these arrangements, which might result in a less efficient operating model across our European legal entities.

Liabilities relating to prior and discontinued operations may adversely affect our results of operations. We, and our predecessors, have a corporate history spanning over eight decades and involving approximately 2,400 previous subsidiaries in diverse businesses, such as the manufacturing of locomotives, buses, industrial chemicals, fertilizers, pharmaceuticals, leather, textiles, food, and fresh meats. Some of those businesses used raw materials that have been, and may continue to be, subject to litigation. Moreover, some of the raw materials used and the waste produced by those businesses have been and are the subject of U.S. federal and state environmental regulations, including laws enacted under the Comprehensive Environmental Response, Compensation and Liability Act, or its state law counterparts. In addition, we may incur other liabilities, resulting from indemnification claims involving previously sold subsidiaries, as well as from past operations of predecessors or their subsidiaries. Although we believe we have adequate reserves and sufficient insurance coverage to cover those future liabilities, future events or proceedings could contradict with current assumptions, which could cause reserves or insurance to become inadequate and, ultimately, materially and adversely affect our results of operations.

 

Item 1B. Unresolved Staff Comments

None.

18


 

Item 2. Properties

We operate service or production facilities and maintain sales and service offices in the United States, Canada, the United Kingdom, Germany, the United Arab Emirates, the Netherlands, Switzerland, Romania, and Hong Kong. Our principal properties are operated by GES, Pursuit, and Viad Corporate.

GES

 

 

 

Offices

 

 

Multi-use Facilities(1)

 

 

 

Owned

 

 

Leased

 

 

Owned

 

 

Leased

 

GES U.S.

 

 

 

 

 

19

 

 

 

2

 

 

 

30

 

GES International:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada

 

 

 

 

 

4

 

 

 

 

 

 

7

 

United Kingdom

 

 

 

 

 

3

 

 

 

 

 

 

6

 

Germany

 

 

 

 

 

1

 

 

 

 

 

 

2

 

United Arab Emirates

 

 

 

 

 

1

 

 

 

 

 

 

2

 

Netherlands

 

 

 

 

 

1

 

 

 

 

 

 

2

 

Switzerland

 

 

 

 

 

1

 

 

 

 

 

 

 

Romania

 

 

 

 

 

 

 

 

 

 

 

1

 

Hong Kong

 

 

 

 

 

1

 

 

 

 

 

 

 

Total GES International

 

 

 

 

 

12

 

 

 

 

 

 

20

 

Total GES

 

 

 

 

 

31

 

 

 

2

 

 

 

50

 

 

(1)

Multi-use facilities include manufacturing, sales and design, office, storage and/or warehouse, and truck marshaling yards. Multi-use facilities vary in size up to approximately 677,800 square feet at GES U.S. and approximately 133,600 square feet at GES International.

Pursuit

 

 

 

Owned

 

 

Leased

 

Offices(1)

 

 

2

 

 

 

5

 

Retail stores

 

 

23

 

 

 

1

 

Bus terminal

 

 

1

 

 

 

 

Garages(1)

 

 

4

 

 

 

2

 

Attractions(1)

 

 

7

 

 

 

 

Hotels/Lodges(1)(2)

 

 

15

 

 

 

 

Total Pursuit

 

 

52

 

 

 

8

 

(1)

Includes four hotels/lodges, an office, all of the owned garages, and all of the Canadian-based attractions situated on land subject to multiple long-term ground leases with the Canadian government.

(2)

Includes ancillary food and beverage services, retail, and recreational facilities.

Viad Headquarters

Our headquarters is leased and approximates 19,900 square feet, and is located at 1850 North Central Avenue, Suite 1900 in Phoenix, Arizona 85004-4565.

We believe our facilities are adequate and suitable for our business operations and that capacity is sufficient for current needs. For additional information related to our lease obligations, refer to Note 11 – Debt and Capital Lease Obligations and Note 19 – Leases and Other of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

Item 3. Legal Proceedings

Refer to Note 20 – Litigation, Claims, Contingencies, and Other of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K) for information regarding legal proceedings for which we are involved.

19


 

Item 4. Mine Safety Disclosures

Not applicable.

Other. Executive Officers of the Registrant

Our executive officers as of December 31, 2017 were as follows:

 

Name

 

Age

 

Business Experience During the Past Five Years and Other Information

Steven W. Moster

 

48

 

President and Chief Executive Officer of Viad since 2014; President of GES since 2011; President of Global Experience Specialists, Inc., a wholly-owned subsidiary of Viad, since 2010; prior thereto, independent consultant providing marketing and sales consultation services to 3 Day Blinds Corporation, a manufacturer and retailer of custom window coverings, from April 2010 to August 2010; prior thereto, held various positions within Global Experience Specialists, Inc., including Executive Vice President-Chief Sales & Marketing Officer from 2008 to 2010; Executive Vice President-Products and Services from 2006 to 2008; and Vice President-Products & Services Business from 2005 to 2006; and prior thereto, Engagement Manager, Management Strategy Consulting for McKinsey & Company, a multinational management consulting firm, from 2000 to 2004.

 

 

 

 

 

Ellen M. Ingersoll

 

53

 

Chief Financial Officer since July 2002; prior thereto, Vice President-Controller or similar position since 2002; prior thereto, Controller of CashX, Inc., a service provider of stored value internet cards, from June 2001 through October 2001; prior thereto, Operations Finance Director of LeapSource, Inc., a provider of business process outsourcing, from 2000 to June 2001; and prior thereto, Vice President and Controller of Franchise Finance Corporation of America since 1992.

 

 

 

 

 

David W. Barry

 

55

 

President of Pursuit since June 2015; prior thereto, Chief Executive Officer and President of Trust Company of America, the largest independent registered investment adviser custodian in the United States, from 2011 to June 2015; prior thereto, Chief Executive Officer of The Alpine Group of Companies, the largest helicopter skiing company in the world and a division of Intrawest Resorts Holdings, Inc., a public company, from 2004 to 2011; and prior thereto, President and Chief Operating Officer of Intrawest USA, a $500 million division of Intrawest Resorts Holdings, Inc. with 13,000 employees, from 2004 to 2007.

 

 

 

 

 

Leslie S. Striedel

 

 

55

 

Chief Accounting Officer since 2014; prior thereto, Vice President of Finance from March 2014 to April 2014; prior thereto, Vice President of Finance and Administration or similar positions with Colt Defense LLC, a designer, developer and manufacturer of firearms for military, personal defense and recreational purposes, from 2010 to 2013; prior thereto, Vice President of Finance, Director of Financial Reporting and Compliance and Corporate Controller of White Electronics Designs Corp. (now a subsidiary of Microsemi Corporation), a public company manufacturing circuits and semiconductors, from 2004 to 2010; and prior thereto, Corporate Controller of MD Helicopters, an international helicopter manufacturer, Corporate Controller of Fluke Networks (formerly Microtest, Inc.), a publicly-traded manufacturing and technology company, and Senior Tax Manager for KPMG LLP.

Our executive officers’ term of office is until our next Board of Directors annual organization meeting to be held on May 17, 2018.

 

20


 

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock is traded on the New York Stock Exchange under the symbol VVI. The high and low common stock market prices per share were as follows:

 

 

 

2017

 

 

2016

 

 

 

High

 

 

Low

 

 

High

 

 

Low

 

First Quarter

 

$

48.30

 

 

$

42.40

 

 

$

29.84

 

 

$

25.90

 

Second Quarter

 

$

48.85

 

 

$

42.05

 

 

$

32.29

 

 

$

27.96

 

Third Quarter

 

$

61.65

 

 

$

46.05

 

 

$

37.85

 

 

$

30.21

 

Fourth Quarter

 

$

61.85

 

 

$

53.65

 

 

$

47.40

 

 

$

34.40

 

Holders

As of January 31, 2018, there were 5,600 shareholders of record of our common stock, including 293 shareholders that had not converted their shares following a reverse stock split effective on July 1, 2004.

Dividends

For the year ended December 31, 2017, our Board of Directors declared the following dividends:

 

Declaration Date

 

Dividend Per Share

 

 

Record Date

 

Payable Date

November 29, 2017

 

$

0.10

 

 

December 15, 2017

 

January 2, 2018

August 16, 2017

 

$

0.10

 

 

September 8, 2017

 

October 2, 2017

May 18, 2017

 

$

0.10

 

 

June 2, 2017

 

July 3, 2017

February 22, 2017

 

$

0.10

 

 

March 10, 2017

 

April 3, 2017

 

For the year ended December 31, 2016, our Board of Directors declared the following dividends:

 

Declaration Date

 

Dividend Per Share

 

 

Record Date

 

Payable Date

December 1, 2016

 

$

0.10

 

 

December 16, 2016

 

January 3, 2017

August 24, 2016

 

$

0.10

 

 

September 9, 2016

 

October 3, 2016

May 19, 2016

 

$

0.10

 

 

June 3, 2016

 

July 1, 2016

February 24, 2016

 

$

0.10

 

 

March 11, 2016

 

April 1, 2016

Issuer Purchases of Equity Securities

During the fourth quarter of 2017, certain previously owned shares of common stock were surrendered by employees, former employees, and non-employee directors for tax withholding requirements on vested share-based awards.

 

Period

 

Total Number of Shares Purchased

 

 

Average Price Paid

Per Share

 

 

Total Number of Shares

Purchased as Part of Publicly

Announced Plans or Programs

 

 

Maximum Number of Shares

That May Yet Be Purchased

Under the Plans or Programs

 

October 1, 2017 - October 31, 2017

 

 

2,968

 

 

$

59.83

 

 

 

 

 

 

440,540

 

November 1, 2017 - November 30, 2017

 

 

497

 

 

$

55.55

 

 

 

 

 

 

440,540

 

December 1, 2017 - December 31, 2017

 

 

11,151

 

 

$

57.60

 

 

 

 

 

 

440,540

 

Total

 

 

14,616

 

 

$

57.98

 

 

 

 

 

 

440,540

 

Our Board of Directors has authorized us to repurchase shares of our common stock from time to time at prevailing market prices. As of December 31, 2017, 440,540 shares remain available for repurchase. The Board’s authorization has no expiration date. During the three months ended December 31, 2017, no shares were repurchased on the open market.

21


 

Performance Graph

The following graph compares the change in the cumulative total shareholder return, from December 31, 2012 to December 31, 2017, on our common stock, the Standard & Poor’s SmallCap 600 Media Index, the Standard & Poor’s SmallCap 600 Commercial Services & Supplies Index, the Standard & Poor’s SmallCap 600 Index, the Russell 2000 Index, and Standard & Poor’s 500 Index (assuming reinvestment of dividends, as applicable). The graph assumes $100 was invested on December 31, 2012.

 

 

 

 

Year Ended December 31,

 

 

 

2012

 

 

2013

 

 

2014

 

 

2015

 

 

2016

 

 

2017

 

Viad Corp

 

$

100.00

 

 

$

114.17

 

 

$

118.43

 

 

$

127.22

 

 

$

201.04

 

 

$

254.60

 

S&P 500

 

$

100.00

 

 

$

132.38

 

 

$

150.47

 

 

$

152.53

 

 

$

170.76

 

 

$

208.02

 

Russell 2000

 

$

100.00

 

 

$

138.82

 

 

$

145.64

 

 

$

139.21

 

 

$

168.84

 

 

$

193.54

 

S&P SmallCap 600

 

$

100.00

 

 

$

141.31

 

 

$

149.42

 

 

$

146.42

 

 

$

185.16

 

 

$

209.51

 

S&P 600 Comm. Services & Supplies

 

$

100.00

 

 

$

143.41

 

 

$

142.43

 

 

$

139.00

 

 

$

177.43

 

 

$

189.99

 

S&P 600 Media Index

 

$

100.00

 

 

$

162.65

 

 

$

190.80

 

 

$

201.03

 

 

$

180.37

 

 

$

207.93

 

 

22


 

Item 6. Selected Financial Data

 

 

 

Year Ended December 31,

 

(in thousands, except per share data)

 

2017

 

 

2016

 

 

2015

 

 

2014

 

 

2013

 

Summary Statement of Operations Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue (1) :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibition and event services

 

$

967,352

 

 

$

881,137

 

 

$

799,752

 

 

$

772,770

 

 

$

685,350

 

Exhibits and environments

 

 

165,745

 

 

 

170,469

 

 

 

177,126

 

 

 

171,698

 

 

 

159,554

 

Pursuit services

 

 

173,868

 

 

 

153,364

 

 

 

112,170

 

 

 

120,519

 

 

 

108,443

 

Total revenue

 

$

1,306,965

 

 

$

1,204,970

 

 

$

1,089,048

 

 

$

1,064,987

 

 

$

953,347

 

Income from continuing operations (2)

 

$

58,452

 

 

$

43,479

 

 

$

27,442

 

 

$

41,178

 

 

$

19,320

 

Income from continuing operations attributable to Viad common

   stockholders

 

$

57,975

 

 

$

42,953

 

 

$

27,000

 

 

$

40,790

 

 

$

19,437

 

Basic and diluted income from continuing operations attributable to

   Viad common stockholders per share (2)

 

$

2.84

 

 

$

2.12

 

 

$

1.34

 

 

$

2.02

 

 

$

0.96

 

Dividends declared per common share

 

$

0.40

 

 

$

0.40

 

 

$

0.40

 

 

$

1.90

 

 

$

2.90

 

Other Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA (3)

 

$

137,550

 

 

$

112,428

 

 

$

76,801

 

 

$

73,954

 

 

$

59,157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

(in thousands)

 

2017

 

 

2016

 

 

2015

 

 

2014

 

 

2013

 

Summary Balance Sheet Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

53,723

 

 

$

20,900

 

 

$

56,531

 

 

$

56,990

 

 

$

45,821

 

Total assets

 

$

919,899

 

 

$

869,816

 

 

$

690,723

 

 

$

712,979

 

 

$

561,424

 

Total debt and capital lease obligations

 

$

209,192

 

 

$

249,211

 

 

$

127,403

 

 

$

139,056

 

 

$

11,160

 

Redeemable noncontrolling interest (4)

 

$

6,648

 

 

$

 

 

$

 

 

$

 

 

$

 

Total stockholders’ equity

 

$

442,937

 

 

$

370,638

 

 

$

335,338

 

 

$

347,702

 

 

$

356,543

 

Non-redeemable noncontrolling interest

 

$

13,806

 

 

$

13,283

 

 

$

12,757

 

 

$

12,315

 

 

$

9,102

 

 

(1)

The 2017 amounts include $1.4 million in revenue from our Poken acquisition. The 2016 amounts include an aggregate $55.7 million in revenue from our acquisitions of ON Services, CATC Alaska Tourism Corporation (“CATC”), Maligne Lake Tours Ltd. (“Maligne Lake Tours”), and FlyOver Canada. The 2014 amounts include an aggregate $21.2 million in revenue from our acquisitions of the West Glacier Properties, Blitz, onPeak, and N200. Refer to Note 3 – Acquisition of Businesses of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

(2)

Income from continuing operations includes the following items:

 

Restructuring charges, pre-tax, of $1.0 million in 2017, $5.2 million in 2016, $3.0 million in 2015, $1.6 million in 2014, and $3.8 million in 2013. Refer to Note 18 – Restructuring Charges of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

 

Impairment charges (recoveries), pre-tax, net, of $(29.1) million in 2017, $0.2 million in 2016, $0.1 million in 2015, $0.9 million in 2014, and $1.0 million in 2013. Refer to Note 6 – Property and Equipment of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

 

Income tax expense in 2017 included a $16.1 million charge related to the Tax Act. Income tax expense in 2015 included a $1.6 million non-cash tax benefit related to deferred taxes associated with certain foreign intangibles. Income tax expense in 2014 included the $11.7 million valuation allowance release related to our foreign tax credit and state net operating loss carryforwards. Refer to Note 16 – Income Taxes of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K).

(3)

Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (Part II, Item 7 of this 2017 Form 10-K) for a discussion of the “Non-GAAP Measures.”

(4)

On November 3, 2017, we acquired the controlling interest (54.5% of the common stock) in Esja, a private corporation in Reykjavik, Iceland, The Esja acquisition contains a put option that gives the minority Esja shareholders the right to sell (or “put”) their Esja shares to us based on a calculated formula within a predefined term.

 

23


 

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the consolidated financial statements and related notes. The MD&A is intended to assist you in understanding our financial condition and results of operations. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated due to various factors discussed under “Risk Factors,” “Forward-Looking Statements,” and elsewhere in this 2017 Form 10-K.

Overview

We are an international experiential services company with operations in the United States, Canada, the United Kingdom, continental Europe, and the United Arab Emirates. We are committed to providing unforgettable experiences to our clients and guests. We operate through three reportable business segments: GES U.S., GES International, (collectively, “GES”), and Pursuit.

GES is a global, full-service provider for live events that produces exhibitions, conferences, corporate events, and consumer events. GES offers a comprehensive range of live event services and a full suite of audio-visual services from creative and technology to content and design, along with online tools powered by next generation technologies that help clients easily manage the complexities of their events.

Pursuit is a collection of iconic natural and cultural destination travel experiences that enjoy perennial demand. Pursuit offers guests distinctive and world renowned experiences through its collection of unique hotels and lodges, world-class recreational attractions, and ground transportation services.

 


24


 

Results of Operations

Financial Highlights

 

 

 

Year Ended December 31,

 

 

 

 

 

 

 

 

 

(in thousands, except per share data)

 

2017

 

 

2016

 

 

2015

 

 

Percentage

Change

2017 vs. 2016

 

 

Percentage

Change

2016 vs. 2015

 

Revenue

 

$

1,306,965

 

 

$

1,204,970

 

 

$

1,089,048

 

 

 

8.5

%

 

 

10.6

%

Net income attributable to Viad

 

$

57,707

 

 

$

42,269

 

 

$

26,606

 

 

 

36.5

%

 

 

58.9

%

Segment operating income (1)

 

$

97,051

 

 

$

85,928

 

 

$

54,584

 

 

 

12.9

%

 

 

57.4

%

Diluted income per common share from continuing operations attributable to Viad common stockholders

 

$

2.84

 

 

$

2.12

 

 

$

1.34

 

 

 

34.0

%

 

 

58.2

%

2017 compared with 2016

 

Total revenue increased $102.0 million or 8.5%, mainly due to the incremental revenue from the ON Services and FlyOver Canada acquisitions, and to a lesser degree, the Poken, and CATC acquisitions, of $52.6 million and underlying growth at GES and Pursuit, offset in part by negative show rotation of approximately $8 million and an unfavorable foreign exchange impact of $5.6 million.

 

Net income attributable to Viad increased $15.4 million or 36.5%, primarily due to impairment recoveries of $29.1 million related to the Mount Royal Hotel fire, higher segment operating income, and a decrease in restructuring charges, offset in part by higher tax expense, including a $16.1 million charge as a result of the Tax Cuts and Jobs Act (the “Tax Act”) enacted on December 22, 2017, higher corporate activities expense due to an increase in performance-based compensation driven by our stock price appreciation, and higher interest expense.

 

Total segment operating income(1) increased $11.1 million or 12.9%, primarily due to the increase in revenue.

2016 compared with 2015

 

Total revenue increased $115.9 million or 10.6%, mainly due to the incremental revenue from the 2016 acquisitions, primarily CATC, ON Services, and Maligne Lake Tours of $55.7 million, positive show rotation of approximately $52 million, and continued underlying growth in both GES and Pursuit, offset in part by an unfavorable foreign exchange impact of $24.0 million.

 

Net income attributable to Viad increased $15.7 million or 58.9%, primarily due to increased segment operating income at GES and Pursuit, offset in part by higher income tax expense.

 

Total segment operating income(1) increased $31.3 million or 57.4%, primarily due to high flow-through on the increase in revenue.

(1)

Refer to Note 22 – Segment Information of the Notes to Consolidated Financial Statements (Part II, Item 8 of this 2017 Form 10-K) for a reconciliation of the non-GAAP financial measure, segment operating income, to the most directly comparable GAAP measure.

25


 

Foreign Exchange Rate Variances

We conduct our foreign operations primarily in Canada, the United Kingdom, the Netherlands, Germany, and to a lesser extent, in certain other countries.

2017 compared with 2016

The following table summarizes the foreign exchange rate variance effects (or “FX Impact”) on revenue and segment operating results from our significant international operations for the years ended December 31, 2017 and 2016, excluding the effect of acquisitions completed during 2017 and 2016:

 

 

 

Revenue

 

 

Segment Operating Results

 

 

 

Weighted-Average

Exchange Rates

 

 

FX Impact

 

 

Weighted-Average

Exchange Rates

 

 

FX Impact

 

 

 

2017

 

 

2016

 

 

(in thousands)

 

 

2017

 

 

2016

 

 

(in thousands)

 

GES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada (CAD)

 

$

0.77

 

 

$

0.76

 

 

$

775

 

 

$

0.77

 

 

$

0.76

 

 

$

(114

)

United Kingdom (GBP)

 

$

1.29

 

 

$

1.35

 

 

 

(9,001

)

 

$

1.30

 

 

$

1.33

 

 

 

(160

)

Europe (EUR)

 

$

1.14

 

 

$

1.11

 

 

 

970

 

 

$

1.15

 

 

$

1.10

 

 

 

131

 

 

 

 

 

 

 

 

 

 

 

 

(7,256

)

 

 

 

 

 

 

 

 

 

 

(143

)

Pursuit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada (CAD)

 

$

0.78

 

 

$

0.77

 

 

 

1,676

 

 

$

0.78

 

 

$

0.76

 

 

 

710

 

 

 

 

 

 

 

 

 

 

 

$

(5,580

)

 

 

 

 

 

 

 

 

 

$

567

 

2016 compared with 2015

The following table summarizes the FX Impact on revenue and segment operating results from our significant international operations for the years ended December 31, 2016 and 2015, excluding the effect of acquisitions completed during 2016:

 

 

 

Revenue

 

 

Segment Operating Results

 

 

 

Weighted-Average

Exchange Rates

 

 

FX Impact

 

 

Weighted-Average

Exchange Rates

 

 

FX Impact

 

 

 

2016

 

 

2015

 

 

(in thousands)

 

 

2016

 

 

2015

 

 

(in thousands)

 

GES:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Canada (CAD)

 

$

0.76

 

 

$

0.78

 

 

$

(1,852

)

 

$

0.76

 

 

$

0.79

 

 

$

(77

)

United Kingdom (GBP)

 

$

1.35

 

 

$

1.53

 

 

 

(20,946

)

 

$

1.34

 

 

$

1.53

 

 

 

(632

)

Europe (EUR)

 

$

1.11

 

 

$

1.10

 

 

 

150

 

 

$

1.10

 

 

$

1.11

 

 

 

36

 

 

 

 

 

 

 

 

 

 

 

 

(22,648

)

 

 

 

 

 

 

 

 

 

 

(673

)

Pursuit: