# Pursuit Attractions & Hospitality, Inc.: Form 10-Q for the period ended Mar 31, 2024

- Company: [Pursuit Attractions & Hospitality, Inc.](/companies/prsu.md) (CIK 884219)
- Form: 10-Q
- Filed: 2024-05-03
- Accepted by EDGAR: May 3, 2024, 13:18 ET
- Period: 2024-03-31
- Accession: 0000950170-24-052502
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/884219/000095017024052502/vvi-20240331.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/884219/000095017024052502/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2024-01-01 to 2024-03-31 | $273.5m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Operating income | 3 months, 2024-01-01 to 2024-03-31 | −$8.5m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2024-01-01 to 2024-03-31 | $11.8m | us-gaap:InterestExpense |
| Income tax | 3 months, 2024-01-01 to 2024-03-31 | $887.0k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2024-01-01 to 2024-03-31 | −$25.1m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-01-01 to 2024-03-31 | −$1.29 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-01-01 to 2024-03-31 | −$1.29 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-01-01 to 2024-03-31 | 21,029,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2024-01-01 to 2024-03-31 | −$7.5m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2024-01-01 to 2024-03-31 | $20.7m | us-gaap:PaymentsToAcquireProductiveAssets |
| Cash and equivalents | at 2024-03-31 | $48.8m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2024-03-31 | $283.5m | us-gaap:AssetsCurrent |
| Total assets | at 2024-03-31 | $1.18bn | us-gaap:Assets |
| Current liabilities | at 2024-03-31 | $292.3m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2024-03-31 | $944.2m | us-gaap:Liabilities |
| Long-term debt | at 2024-03-31 | $406.8m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2024-03-31 | $12.2m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 28,358 characters.

### Forward-Looking Statements

This Quarterly Report on Form 10-Q (this “Form 10-Q”) contains a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words, and variations of words, such as “aim,” “anticipate,” “believe,” “could,” “deliver,” “estimate,” “expect,” “intend,” “may,” “might,” “outlook,” “plan,” “potential,” “seek,” “target,” “will,” and similar expressions are intended to identify our forward-looking statements. Similarly, statements that describe our business strategy, outlook, objectives, plans, initiatives, intentions, or goals also are forward-looking statements. These forward-looking statements are not historical facts and are subject to a host of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those in the forward-looking statements.

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

- general economic uncertainty in key global markets and a worsening of global economic conditions;
- travel industry disruptions;
- the impact of our overall level of indebtedness, as well as our financial covenants, on our operational and financial flexibility;
- seasonality of our businesses;
- unanticipated delays and cost overruns of our capital projects, and our ability to achieve established financial and strategic goals for such projects;
- the importance of key members of our account teams to our business relationships;
- our ability to manage our business and continue our growth if we lose any of our key personnel;
- the competitive nature of the industries in which we operate;
- our dependence on large exhibition event clients;
- adverse effects of show rotation on our periodic results and operating margins;
- transportation disruptions and increases in transportation costs;
- natural disasters, weather conditions, accidents, and other catastrophic events;
- our exposure to labor cost increases and work stoppages related to unionized employees;
- our multi-employer pension plan funding obligations;
- our ability to successfully integrate and achieve established financial and strategic goals from acquisitions;
- our exposure to cybersecurity attacks and threats;
- our exposure to currency exchange rate fluctuations;
- liabilities relating to prior and discontinued operations;
- sufficiency and cost of insurance coverage; and
- compliance with laws governing the storage, collection, handling, and transfer of personal data and our exposure to legal claims and fines for data breaches or improper handling of such data.

For a more complete discussion of the risks and uncertainties that may affect our business or financial results, refer to Item 1A – *Risk Factors* of our 2023 Form 10-K. We disclaim and do not undertake any obligation to update or revise any forward-looking statement except as required by applicable law or regulation.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our 2023 Form 10-K and the condensed consolidated financial statements and related notes included in this Form 10-Q. The MD&A is intended to assist in understanding our financial condition and results of operations.

### Overview

We are a leading provider of extraordinary experiences, including hospitality and leisure activities, experiential marketing, and live events. We operate through three reportable segments: Pursuit, Spiro, and GES Exhibitions. Spiro and GES Exhibitions are both live event businesses, and are referred to collectively as “GES.”

### Seasonality

Pursuit’s peak activity occurs during the summer months. During 2023, 79% of Pursuit’s revenue was earned in the second and third quarters.

GES’ live 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.

### Results of Operations

### Financial Highlights

*(in thousands, except per share data)*

|  | Three Months Ended March 31, 2024 | 2023 | % Change |
| --- | ---: | ---: | ---: |
| Total revenue | $273,497 | $260,791 | 4.9% |
| Net loss attributable to Viad | $(25,117) | $(20,869) | (20.4)% |
| Segment operating loss(1) | $(8,473) | $(5,528) | (53.3)% |
| Diluted loss per common share from continuing operations attributable to Viad common stockholders | $(1.29) | $(1.10) | (17.3)% |

(1) Refer to Note 23 – *Segment Information* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for a reconciliation of the non-GAAP financial measure, segment operating income (loss), to the most directly comparable GAAP measure.

### Three months ended March 31, 2024 compared with the three months ended March 31, 2023

- **Total revenue** increased $12.7 million during the three months ended March 31, 2024 due to increased revenue at GES of $8.1 million and increased revenue at Pursuit of $4.6 million.
- **Net loss attributable to Viad** increased $4.2 million during the three months ended March 31, 2024, primarily reflecting a higher segment operating loss at Pursuit and higher income tax expense of $1.5 million.
- **Segment operating loss** increased $2.9 million during the three months ended March 31, 2024, primarily due to a $4.7 million higher segment operating loss at Pursuit, offset in part by $1.8 million higher segment operating income at GES.

### Analysis of Revenue and Operating Results by Reportable Segment

### Pursuit

The following table presents a comparison of Pursuit’s reported revenue and segment operating loss for the three months ended March 31, 2024 and 2023:

*(in thousands)*

| Revenue(1): Pursuit: | Three Months Ended March 31, 2024 | 2023 | % Change |
| --- | ---: | ---: | ---: |
| Attractions | $22,980 | $19,004 | 20.9% |
| Hospitality | 11,580 | 11,203 | 3.4% |
| Transportation | 1,928 | 1,973 | (2.3)% |
| Other | 743 | 483 | 53.8% |
| Total Pursuit | $37,231 | $32,663 | 14.0% |
| **Segment operating loss(2):** |  |  |  |
| Total Pursuit | $(23,831) | $(19,112) | (24.7)% |

(1) Revenue by line of business does not agree to Note 2 – *Revenue and Related Contract Costs and Contract Liabilities* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) as the amounts in the above table include product revenue from food and beverage and retail operations within each line of business.

(2) Refer to Note 23 – *Segment Information* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for a reconciliation of the non-GAAP financial measure, segment operating income (loss), to the most directly comparable GAAP measure.

### Three months ended March 31, 2024 compared with the three months ended March 31, 2023

**Pursuit revenue** increased $4.6 million driven primarily by an increase in attractions revenue of $4.0 million due to a 10.4% increase in the number of visitors at our year-round attractions as well as higher revenue per attraction visitor of 9.5%. Our Sky Lagoon attraction in Iceland had particularly strong demand with increased revenue of $3.6 million. FlyOver Chicago opened on March 1, 2024 and contributed revenue of $0.8 million.

**Pursuit segment operating loss** increased $4.7 million from the prior year period primarily due an increase in operating costs to support higher business volume during the three months ended March 31, 2024, as well as start-up costs to open the new FlyOver Chicago attraction, offset in part by the increase in revenue.

### Performance Measures

We use the following key business metrics to evaluate the performance of Pursuit’s attractions business:

- **Number of visitors**. The number of visitors allows us to assess the volume of tickets sold at each attraction during the period.
- **Revenue per attraction visitor**. Revenue per attraction visitor is calculated as total attractions revenue divided by the total number of visitors at all Pursuit attractions during the period. Total attractions revenue includes ticket sales and ancillary revenue generated by attractions, such as food and beverage and retail revenue. Total attractions revenue per visitor measures the total spend per visitor that attraction properties are able to capture, which is important to the profitability of the attractions business.
- **Effective ticket price**. Effective ticket price is calculated as revenue from the sale of attraction tickets divided by the total number of visitors at all comparable Pursuit attractions during the period.

We use the following key business metrics, common in the hospitality industry, to evaluate Pursuit’s hospitality business:

- **Revenue per Available Room (“RevPAR”).** RevPAR is calculated as total rooms revenue divided by the total number of room nights available for all comparable Pursuit hospitality properties during the period. Total rooms revenue does not include non-rooms revenue, which consists of ancillary revenue generated by hospitality properties, such as food and beverage and retail revenue. RevPAR measures the period-over-period change in rooms revenue per available room for comparable hospitality properties. RevPAR is affected by average daily rate and occupancy, which have different implications on profitability.
- **Average Daily Rate (“ADR”).** ADR is calculated as total rooms revenue divided by the total number of room nights sold for all comparable Pursuit hospitality properties during the period. ADR is used to assess the pricing levels that the hospitality properties are able to realize. Increases in ADR lead to increases in rooms revenue with no substantial effect on variable costs, therefore having a greater impact on margins than increases in occupancy.
- **Occupancy.** Occupancy is calculated as the total number of room nights sold divided by the total number of room nights available for all comparable Pursuit hospitality properties during the period. Occupancy measures the utilization of the available capacity at the hospitality properties. Increases in occupancy result in increases in rooms revenue and additional variable operating costs (including housekeeping services, utilities, and room amenity costs), as well as increases in ancillary non-rooms revenue (including food and beverage and retail revenue).

The following table provides Pursuit’s key performance indicators:

| Attractions Key Performance Indicators: | Three Months Ended March 31, 2024 As Reported | New Experiences(1) | Same-Store(2) | Three Months Ended March 31, 2023 As Reported | New Experiences(1) | FX Impact(3) | Same-Store(2) | % Change As Reported | Same-Store(2) |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Number of visitors | 451,808 | 35,660 | 416,148 | 409,136 | — | — | 409,136 | 10.4% | 1.7% |
| Ticket revenue (in thousands) | $17,805 | $667 | $17,137 | $14,261 | $— | $(253) | $14,514 | 24.9% | 18.1% |
| Effective ticket price | $39.41 | $18.72 | $41.18 | $34.86 | $— | $— | $35.47 | 13.1% | 16.1% |
| Attractions revenue (in thousands) | $22,980 | $761 | $22,219 | $19,004 | $— | $(323) | $19,328 | 20.9% | 15.0% |
| Revenue per attraction visitor | $50.86 | $21.35 | $53.39 | $46.45 | $— | $— | $47.24 | 9.5% | 13.0% |
| **Hospitality Key Performance Indicators:** |  |  |  |  |  |  |  |  |  |
| Room nights available | 117,310 | — | 117,310 | 115,421 | — | — | 115,421 | 1.6% | 1.6% |
| Rooms revenue (in thousands) | $7,604 | $— | $7,604 | $7,590 | $— | $(20) | $7,610 | 0.2% | (0.1)% |
| RevPAR | $64.82 | $— | $64.82 | $65.76 | $— | $— | $65.94 | (1.4)% | (1.7)% |
| Occupancy | 57.7% | — | 57.7% | 59.5% | — | — | 59.5% | (1.8)% | (1.8)% |
| ADR | $112.40 | $— | $112.40 | $110.48 | $— | $— | $110.78 | 1.7% | 1.5% |
| Hospitality revenue (in thousands) | $11,580 | $— | $11,580 | $11,203 | $— | $(27) | $11,230 | 3.4% | 3.1% |

(1) New experiences include FlyOver Chicago (opened March 1, 2024).

(2) Same-Store metrics include only attractions and lodging properties that Pursuit operated at full capacity, considering seasonal closures, for the entirety of both periods presented. For experiences located outside the United States, financial metric comparisons to the prior year are expressed on a constant U.S. dollar basis.

(3) Foreign exchange rate variance effects (or “FX Impact”) represents the adjustments necessary to express prior financial metrics on a constant U.S. dollar basis, using the current year quarterly average exchange rates for previous periods to eliminate the impact of changes in exchange rates for same-store Pursuit experiences located outside of the United States.

**Attractions**. The increase in number of attractions visitors during the three months ended March 31, 2024 was primarily driven by higher visitation to Sky Lagoon in Iceland and the opening of FlyOver Chicago on March 1, 2024. The increase in same-store effective ticket price during the three months ended March 31, 2024 was driven primarily by revenue management efforts.

Attractions ticket revenue on a same-store basis increased $2.6 million on a 1.7% increase in visitors and a 16.1% increase in effective ticket price during the three months ended March 31, 2024.

**Hospitality**. The decrease in RevPAR during the three months ended March 31, 2024 was primarily driven by lower occupancy due to unfavorable weather and ski conditions in Jasper that impacted destination demand for that region, offset in part by an increase in ADR.

During the three months ended March 31, 2024, rooms revenue on a same-store basis remained flat despite unfavorable weather.

### GES

The following table presents a comparison of GES’ reported revenue and segment operating income during the three months ended March 31, 2024 and 2023:

*(in thousands)*

| Revenue: GES: | Three Months Ended March 31, 2024 | 2023 | % Change |
| --- | ---: | ---: | ---: |
| Spiro | $61,248 | $60,362 | 1.5% |
| GES Exhibitions | 175,840 | 169,497 | 3.7% |
| Intersegment eliminations | (822) | (1,731) | 52.5% |
| Total GES | $236,266 | $228,128 | 3.6% |
| **Segment operating income (1):** |  |  |  |
| GES: |  |  |  |
| Spiro | $4,001 | $3,174 | 26.1% |
| GES Exhibitions | 11,357 | 10,410 | 9.1% |
| Total GES | $15,358 | $13,584 | 13.1% |

(1) Refer to Note 23 – *Segment Information* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for a reconciliation of the non-GAAP financial measure, segment operating income (loss), to the most directly comparable GAAP measure.

### Three months ended March 31, 2024 compared with the three months ended March 31, 2023

**Spiro revenue** increased $0.9 million primarily due to strong spending from existing and new clients obtained during 2024, offset in part by a reduction of approximately $3 million due to the timing of major non-annual shows.

**GES Exhibitions revenue** increased $6.3 million, primarily due to larger show sizes, including same-show revenue growth of 6.1%, offset in part by a reduction of approximately $1 million due to the timing of major non-annual shows.

**Spiro segment operating income** increased $0.8 million primarily due to higher revenue.

**GES Exhibitions segment operating income** increased $0.9 million, primarily due to higher revenue.

### Other Expenses

*(in thousands)*

|  | Three Months Ended March 31, 2024 | 2023 | % Change |
| --- | ---: | ---: | ---: |
| Corporate activities | $4,433 | $3,165 | 40.1% |
| Interest expense, net | $11,845 | $12,249 | (3.3)% |
| Other expense, net | $438 | $531 | (17.5)% |
| Restructuring charges | $116 | $453 | (74.4)% |
| Income tax expense (benefit) | $887 | $(578) | \*\* |
| Loss from discontinued operations | $(67) | $(58) | (15.5)% |

\*\* Change is greater than +/- 100%.

**Corporate Activities –** The increase in corporate activities is primarily due to increased consulting costs.

**Income Tax Expense –** The effective tax rate was a negative 3.5% for the three months ended March 31, 2024 and a positive 2.6% for three months ended March 31, 2023. The effective rates differed from the 21% federal rate as we do not recognize a tax benefit on losses in the United States and other European countries where we have a valuation allowance. For the three months ended March 31, 2024, we also recorded a $1.1 million benefit for the release of the valuation allowance recorded on the UK tax loss carryforwards, offset by a $0.5 million expense to record estimated withholding taxes associated with the repatriation of Sky Lagoon earnings and a valuation allowance against the tax credit generated from this withholding tax. During the three months March 31, 2023, we released a valuation allowance of $2.1 million that was recorded on deferred tax assets associated with certain separate states, which more than offset taxes due in jurisdictions without a valuation allowance.

### Liquidity and Capital Resources

We believe that our existing sources of liquidity will be sufficient to fund operations and projected capital outlays for at least the next 12 months and the longer term.

When assessing our current sources of liquidity, we include the following:

*(in thousands)*

|  | March 31, 2024 | December 31, 2023 |
| --- | ---: | ---: |
| Unrestricted cash and cash equivalents(1) | $48,799 | $52,704 |
| Available capacity on Revolving Credit Facility(2) | 88,432 | 108,040 |
| **Total available liquidity** | $137,231 | $160,744 |

(1) As of March 31, 2024, we held $47.6 million of our cash and cash equivalents outside of the United States.

(2) As of March 31, 2024, the available capacity includes our total Revolving Credit Facility size of $170 million less $75.9 million of outstanding borrowings and $5.7 million in outstanding letters of credit issued under the Revolving Credit Facility. As of December 31, 2023, the available capacity includes our total Revolving Credit Facility size of $170 million less $57.0 million of outstanding borrowings and $5.0 million in outstanding letters of credit issued under the Revolving Credit Facility.

Cash provided by operating activities, supplemented by our revolving credit facility and existing cash and cash equivalents, is our primary source of liquidity for funding our business requirements. During the three months ended March 31, 2024, net cash used in operating activities was $7.5 million.

Our short-term and long-term funding requirements include debt obligations, maintenance capital expenditures, working capital requirements, and potential acquisitions and strategic investments as we focus on scaling Pursuit with investments in high-return unforgettable, inspiring experiences through its Refresh, Build, Buy growth strategy. Our projected capital outlays can be adjusted for changes in the operating environment.

### Debt Obligations

Effective July 30, 2021, we entered into the 2021 Credit Facility. The 2021 Credit Facility provided for a $400 million Term Loan B, with a maturity date of July 30, 2028, and a $100 million Revolving Credit Facility, with a maturity date of July 30, 2026. The proceeds of the Term Loan B, net of $14.8 million in related fees, were used to repay the $327 million outstanding balance under our prior $450 million revolving credit facility and to provide for financial flexibility to fund future acquisitions and growth initiatives and for general corporate purposes. On January 4, 2023, we entered into an interest rate cap agreement with an effective date of January 31, 2023. The interest rate cap manages our exposure to interest rate increases on $300 million in borrowings under the 2021 Credit Facility or other

SOFR-based borrowings. Refer to Note 12 – *Derivative* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for additional information.

The Revolving Credit Facility carries financial covenants. As of March 31, 2024, we were in compliance with all covenants under the Revolving Credit Facility.

On March 28, 2023, we entered into the Second Amendment to the 2021 Credit Facility, which modified the interest coverage financial covenant. On October 6, 2023, we entered into the Third Amendment to the 2021 Credit Facility, which among other things, increased the principal amount of the Revolving Credit Facility by $70 million, bringing the total amount of revolving capacity to $170 million. In connection with the Third Amendment, we prepaid $70 million of the outstanding balance on our existing Term Loan B using $60 million from the Revolving Credit Facility and $10 million of cash from the Company’s balance sheet. The current credit spread on our Revolving Credit Facility is 2.00% lower than the credit spread on the Term Loan B, which was 5.00% for SOFR borrowings through April 25, 2024. On April 26, 2024, we entered into the Fourth Amendment to the 2021 Credit Agreement, which among other things, (i) reduced the applicable rate on the Term Loan B by 0.75%, to SOFR + 4.25%, (ii) set the credit spread adjustments to 0% on the Term Loan B and (iii) reset the 1% prepayment premium on any repricings of the Term Loan B for six months. Refer to Note 25 – *Subsequent Event* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for additional information.

For additional information about our debt and finance obligations, refer to Note 11 – *Debt and Finance Obligations* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q), all of which is incorporated by reference herein.

### Capital Expenditures

As of March 31, 2024, we have planned capital expenditures of approximately $60 million to $70 million for the next 12 months, including approximately $20 million on select growth projects. We intend to continue making selective investments to advance Pursuit’s Refresh, Build, Buy growth strategy while maintaining a solid liquidity position.

### Other Obligations

We have additional obligations as part of our ordinary course of business, beyond those committed for debt obligations and capital expenditures. Refer to Note 20 – *Leases and Other* and Note 18 – *Pension and Postretirement Benefits* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for further information. The expected timing of payments of our obligations is estimated based on current information. Timing of payments and actual amounts paid may be different, depending on changes to agreed-upon amounts for certain obligations.

### Cash Flows

### Operating Activities

*(in thousands)*

|  | Three Months Ended March 31, 2024 | 2023 |
| --- | ---: | ---: |
| Net loss | $(26,243) | $(21,390) |
| Depreciation and amortization | 13,320 | 12,475 |
| Deferred income taxes | 799 | (2,304) |
| Loss from discontinued operations | 67 | 58 |
| Restructuring charges | 116 | 453 |
| Gains on dispositions of property and other assets | (5) | (58) |
| Share-based compensation expense | 3,107 | 3,065 |
| Other non-cash items, net | 2,927 | 1,331 |
| Changes in operating assets and liabilities | (1,631) | 16,439 |
| **Net cash provided by (used in) operating activities** | $(7,543) | $10,069 |

Net cash provided by (used in) operating activities decreased $17.6 million primarily due to outflows due to changes in working capital and a higher segment operating loss at Pursuit.

### Investing Activities

*(in thousands)*

|  | Three Months Ended March 31, 2024 | 2023 |
| --- | ---: | ---: |
| Capital expenditures | $(20,721) | $(11,384) |
| Cash paid for acquisitions, net | — | (41) |
| Proceeds from dispositions of property and other assets | 5 | 66 |
| **Net cash used in investing activities** | $(20,716) | $(11,359) |

Net cash used in investing activities increased $9.4 million primarily due to an increase in capital expenditures in 2024.

### Financing Activities

*(in thousands)*

|  | Three Months Ended March 31, 2024 | 2023 |
| --- | ---: | ---: |
| Proceeds from borrowings | $154,243 | $1,819 |
| Payments on debt and finance obligations | (127,964) | (5,749) |
| Dividends paid on preferred stock | — | (1,950) |
| Contributions from noncontrolling interest | 149 | — |
| Payments of debt issuance costs | (51) | (200) |
| Payment of payroll taxes on stock-based compensation through shares withheld or repurchased | (996) | (412) |
| **Net cash provided by (used in) financing activities** | $25,381 | $(6,492) |

The change in net cash (used in) provided by financing activities of $31.9 million was primarily due to net debt borrowings of $26.3 million during the three months ended March 31, 2024 compared to net debt payments of $3.9 million during the three months ended March 31, 2023.

### Share Repurchases

Our Board of Directors previously authorized us to repurchase shares of our common stock from time to time at prevailing market prices. As of March 31, 2024, 546,283 shares remained available for repurchase under all prior authorizations. In March 2020, our Board of Directors suspended our share repurchase program. The Board of Directors’ authorization does not have an expiration date.

Additionally, we repurchased shares related to tax withholding requirements on vested restricted share-based awards.

### Critical Accounting Estimates

Refer to Part II, Item 7 – *Management’s Discussion and Analysis of Financial Condition and Results of Operations* of our 2023 Form 10-K for a discussion of our critical accounting estimates.

### Impact of Recent Accounting Pronouncements

Refer to Note 1 – *Overview and Basis of Presentation* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for additional information.

### Non-GAAP Measure

In addition to disclosing financial results that are determined in accordance with GAAP, we also disclose segment operating income (loss) as a non-GAAP financial measure. Our use of segment operating income (loss) is supplemental to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP. As not all companies use identical calculations, segment operating income (loss) may not be comparable to similarly titled measures used by other companies. We believe that our use of segment operating income (loss) provides useful information to investors regarding our results of operations for trending, analyzing, and benchmarking our performance and the value of our business.

**“Segment operating income (loss)”** is “net income (loss) attributable to Viad” before income (loss) from discontinued operations, corporate activities, net interest expense, income taxes, restructuring charges, impairment charges, and certain other corporate expenses and charges that are not allocated to the reportable segments, and the reduction for income (loss) attributable to noncontrolling interests. Segment operating income (loss) is used to measure the profit and performance of our operating segments to facilitate period-to-period comparisons. Refer to Note 23 – *Segment Information* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for a reconciliation of segment operating income (loss) to income (loss) from continuing operations before income taxes.

We believe segment operating income (loss) is a useful operating metric as it eliminates potential variations arising from taxes, debt service costs, impairment charges, restructuring charges, the reduction of income (loss) attributable to non-controlling interests, and the effects of discontinued operations, resulting in an additional measure considered to be indicative of our ongoing operations and segment performance. Although we use segment operating income (loss) to assess the performance of our business, the use of this measure is limited because this measure does not consider material costs, expenses, and other items necessary to operate, or resulting from, our business. As segment operating income (loss) does not consider these items, net income (loss) attributable to Viad should be considered as an important measure of financial performance because it provides a more complete measure of our performance.

## Market risk

As filed, 3,713 characters.

Our market risk exposure relates to fluctuations in interest rates and foreign exchange rates. Foreign exchange risk is the risk that fluctuating exchange rates will adversely affect our financial condition or results of operations. The foreign exchange risk is composed of both potential losses from the translation of foreign currency financial information and the remeasurement of foreign currency transactions. Interest rate risk is the risk that changing interest rates will adversely affect our financial position or results of operations.

Our foreign operations are primarily in Canada, the United Kingdom, Iceland, the Netherlands, the Middle East, and Germany. The functional currency of our foreign subsidiaries is their local currency. Accordingly, for purposes of consolidation, we translate the assets and liabilities of our foreign subsidiaries into U.S. dollars at the foreign exchange rates in effect at the balance sheet date. The unrealized gains or losses resulting from the translation of these foreign denominated assets and liabilities are included as a component of AOCI in the Condensed Consolidated Balance Sheets. As a result, significant fluctuations in foreign exchange rates relative to the U.S. dollar may result in material changes to our net equity position reported in the Condensed Consolidated Balance Sheets. We do not currently hedge our equity risk arising from the translation of foreign denominated assets and liabilities. We recorded cumulative unrealized foreign currency translation losses in stockholders’ equity of $42.8 million as of March 31, 2024 and $35.3 million as of December 31, 2023. We recorded an unrealized foreign currency translation loss in other comprehensive loss of $7.5 million during the three months ended March 31, 2024 and an unrealized foreign currency translation gain of $1.2 million during the three months ended March 31, 2023.

For purposes of consolidation, revenue, expenses, gains, and losses related to our foreign operations are translated into U.S. dollars at the average foreign exchange rates for the period. As a result, our consolidated results of operations are exposed to fluctuations in foreign exchange rates as revenue and segment operating income (loss) of our foreign operations, when translated, may vary from period to period, even when the functional currency amounts have not changed. Such fluctuations may adversely impact overall expected profitability and historical period-to-period comparisons. We do not currently hedge our net earnings exposure arising from the translation of our foreign revenue and segment operating income (loss).

We are exposed to foreign exchange transaction risk, as our foreign subsidiaries have certain loans and leases denominated in currencies other than the functional currency of the respective subsidiary. As of March 31, 2024, we had long-term contractual liabilities that were denominated in nonfunctional currencies of $46.8 million. As foreign exchange rates fluctuate, these liabilities are remeasured, and the corresponding adjustment is recorded in the Condensed Consolidated Statements of Operations. As of March 31, 2024 and December 31, 2023, we did not have any outstanding foreign currency forward contracts.

On January 4, 2023, we entered into an interest rate cap agreement with an effective date of January 31, 2023 to hedge cash flows on $300 million of our SOFR-based borrowings under the 2021 Credit Facility. Refer to Note 12 – *Derivative* of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for further information.

We are exposed to short-term and long-term interest rate risk on certain of our debt obligations.

## Controls and procedures

As filed, 1,135 characters.

We have established disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and such information is accumulated and communicated to our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure. Management, together with our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2024. Based on this evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective as of March 31, 2024.

### Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting during the three months ended March 31, 2024.

## Risk factors

As filed, 374 characters.

In addition to other information set forth in this report, careful consideration should be given to the factors discussed in Part I, Item 1A – *Risk Factors* and Part II, Item 7 – *Management’s Discussion and Analysis of Financial Condition and Results of Operations* of our 2023 Form 10-K, which could materially affect our business, financial condition, or future results.

Filed May 3, 2024.
Source: SEC EDGAR, the filing index for accession 0000950170-24-052502. Last ingested by Listed: Oct 24, 2026, 14:58 ET. No prices; not investment advice.