Q2 2024 Viad Corp Earnings Call
Concerning business and other risk factors that could cause actual results could materially differ from those in the forward looking statements can be found in our annual quarterly and other current reports filed with the SEC.
Now I'd like to turn the call over to Steve who will start on page four of our earnings presentation.
Steven Moster: Thanks, Carrie, and thanks to all of you for joining our call. I'm happy to report that our second quarter results exceeded our prior guidance, with both GES and PURSUIT delivering very strong performance. GDS's adjusted EBITDA was above our guidance with impressive revenue growth and margin improvement. And based on the strength that we are seeing at GDS, we're raising our full year outlook for GDS's adjusted EBITDA. Pursuits in Justinividad came in near the high end of our guidance range, as we continue to see strong demand for our attractions and lodges and the iconic locations in which we operate.
Steve: Thanks, Kerry and thanks to all of you for joining our call I'm happy to report that our second quarter results exceeded our prior guidance with both Ges and pursuit delivering very strong performance.
Speaker Change: <unk> adjusted EBITDA was above our guidance with impressive revenue growth and margin improvement and based on the strength that we're seeing at Ges, we're raising our full year outlook for Ges's adjusted EBITDA.
Adjusted EBITDA came in near the high end of our guidance range as we continue to see strong demand for our attractions and lodges in the iconic locations in which we operate.
Steven Moster: Entering the third quarter, we had every reason to believe Pursuit would deliver on our prior guidance range for the full year. The peak summer season was off to a strong start, and our advance bookings pointed to healthy year-over-year growth for the second half of 2024.
Speaker Change: Entering the third quarter. We had every reason to believe pursuit would deliver on our prior guidance range for the full year.
Summer season was off to a strong start and our advanced bookings pointed to a healthy year over year growth for the second half of 2024.
Steven Moster: However, our operations in Jasper National Park are currently being impacted by wildfire activity. As we previously disclosed on 8K, the park was closed and evacuated on July 22nd. The majority of the park, including the town of Jasper, remains closed as authorities continue to work to control the fire and restore critical services to the Jasper town site. Our hearts go out to the Jasper community and all who have been impacted, and we're incredibly thankful to the many first responders, firefighters, and our team members for their work to protect lives, homes, businesses, and infrastructure.
However, our operations in Jasper National Park are currently being impacted by wildfire activity.
Speaker Change: As we previously disclosed by 8-K the park is closed and evacuated on July 20 <unk>.
Steven Moster: We will cover the latest updates on the Jasper wildfire and our outlook assumptions later in the call. Right now, I'd like to turn the call over to Ellen, who will review our second quarter financial performance.
Ellen Ingersoll: Thanks Steve. I'll start on page 6 with our consolidated second quarter results. Revenue increased $58.2 million, or 18.2% year-over-year. Consolidated adjusted EBITDA increased $21.5 million, and adjusted net income improved by $17.4 million. Our gap basis net income attributable to Viad was $18.4 million higher than the 2023 second quarter, primarily reflecting stronger business performance, partially offset by higher depreciation
Ellen Ingersoll: As shown on page 7, Pursuit's second-quarter revenue grew $12.7 million, or 14.4% year-over-year, and Adjusted EBITDA increased by $4.2 million. Pursuit's revenue growth was led by attraction ticket revenue, which increased 20% due to a 15% increase in visitors and higher effective ticket prices. Our new Flyover Chicago attraction that opened in March was a big contributor to the visitors. Pursuits' adjusted EBITDA increase primarily reflects revenue growth and margin improvement. As shown on page 8, GES delivered consolidated revenue growth of $45.5 million, or 19.6%, adjusted EBITDA growth of $17.6 million, and very strong margin performance during the second quarter.
Ellen Ingersoll: When adjusting to exclude the $11 million unfavorable impact of major non-annual shows, GES's second quarter year-over-year revenue growth was $56.2 million, or about 26%. Excluding the impact of major non-annual events, Spyro's revenue grew $31.7 million, or about 47%, versus the 2023 second quarter, driven by strong spending from new and existing corporate clients. Excluding the impact of major non-annual events, GES exhibitions revenue grew $24.2 million, or about 16%, versus the 2023 second quarter, primarily due to new client wins and underlying growth.
Ellen Ingersoll: Next, on page 9, we ended the 2024 second quarter with a strong liquidity position with $490.9 million of debt, and our leverage ratio was 2.4 tons, which is below the low end of our target ratio range of 2.5 to 3.5 tons. Now Steve and David will provide further insight into our business performance at GES and PURSUIT.
Steven Moster: Thanks, Ellen. Now let's switch over to GES and review the multiple revenue growth levers on page 11. Starting with GES exhibitions on the left, you will notice that we are driving higher revenue per net square foot of event space through our ability to increase price and capture more same-share spend through additional services and overall higher spending trends.
Steven Moster: We expect that the return of same-show square footage to pre-pandemic levels, which is currently about 10% below 2019, will create a tailwind on overall revenue growth into 2025. Both higher revenue per net square foot and increasing event size will have a high flow through to EBITDA. On the right-hand side of the page is Spyro, our experiential marketing agent.
Steven Moster: We expect to increase our experiential marketing revenue at a high single to low double digit rate through expanding our client roster and selling additional services to our existing clients. Spyro is a trusted strategic and creative branding partner. As one of the few experiential marketing agencies with end-to-end capabilities and global reach, we are well positioned for growth. And I'm very happy to share that we have now reached a total of 64 new client wins since launching Spyro as a discrete experiential marketing agency within GES in early 2022.
Speaker Change: Sales to our existing clients.
Speaker Change: <unk> as a trusted strategic and creative branding partner.
Speaker Change: It's one of the few experiential marketing agencies with end to end capabilities and global reach we are well positioned for growth in.
Speaker Change: I am very happy to share that we have now reached a total of 64, new client wins since launching spiro as a discrete experiential marketing agency within Ges in early 2022.
Steven Moster: Additionally, we're seeing substantial year-over-year growth in our existing client spending. Corporate clients are prioritizing experiential marketing services to connect customers with their brands in a powerful way. We are encouraged by the favorable trend we are seeing overall and robust demand within the industry. In-person live events and other forms of experiential marketing provide an important channel for companies to drive new business, network with key stakeholders, and receive education about relevant topics trending within their industry.
Speaker Change: Additionally, we're seeing substantial year over year growth in our existing client spending corporate clients are prioritizing experiential marketing services to connect customers with their brands in a powerful way.
Speaker Change: We are encouraged by the favorable trend, we are seeing overall and robust demand within the industry.
Speaker Change: In person live events and other forms of experiential marketing provide important channel for companies to drive new business network with key stakeholders and receive education about relevant topics trending within their industries.
Steven Moster: On page 12, you can see GES's overall revenue growth trajectory. PES delivered significant revenue growth in the first half of this year. When adjusting to remove the impact of major non-annual events, GES's consolidated revenue grew by 16% year-to-date compared to 2023. For GDS Exhibitions, that growth rate was about 10%, driven by underlying growth and new client wins. U.S. Exhibition's same-show revenue grew about 5% year-to-date compared to the prior year. For Spyro, the adjusted growth rate was about 29% year-to-date, driven by our success winning new clients and growing revenue from existing clients. The second quarter was particularly strong due to a high volume of new business wins.
Speaker Change: On page 12, you can see Ges's overall revenue growth trajectory.
Speaker Change: <unk> delivered significant revenue growth in the first half of this year when.
Speaker Change: When adjusting to remove the impact of major non annual events Ges's consolidated revenue grew by 16% year to date compared to 2023.
Speaker Change: For GTS exhibitions that growth rate was about 10% driven by underlying growth and new client wins.
Speaker Change: <unk> exhibition same show revenue grew about 5% year to date compared to the prior year.
Speaker Change: For <unk> the adjusted growth rate was about 29% year to date, driven by our success, winning new clients and growing revenue from existing clients.
Steven Moster: As we highlighted on our last call, the most significant new event was the McDonald's 2024 Worldwide Convention in Barcelona, which is one of the largest client projects Spyro will deliver this year. And it is a terrific example of the power of the GS Collective, where GS provided the cutting-edge creative and strategy and was supported by flawless execution from GS Exhibition. The third quarter will see incremental revenue of about $85 to $90 million from our major non-annual shows, including IMTS and Mine Expo, which are held in September.
Steven Moster: While the creative and strategy work for these events started a year in advance, the team is currently finalizing all operational plans and working directly with our clients and partners. With only a month or so to go, both shows are tracking in line with our expectations.
Steven Moster: These favorable trends, along with a strong major non-annual show schedule, give us confidence in our outlook for double-digit full-year revenue growth. The GES team is laser-focused on executing our client experiences in the second half of this year. Now, let's take a look at page 13 and discuss our adjusted EBITDA margin expansion. I'm thrilled with the results that we've seen from our efforts to drive margin improvement at GES. We achieved a 12% adjusted EBITDA margin for the first half of the year, which is up 290 basis points year over year.
Steven Moster: In previous calls, I've talked about the transformation of GES's cost structure and the impact the changes would have on our margin profile. GES's performance in 2024 provides clear evidence that the business can achieve higher margins as revenue increases. We continue to expect to deliver on an adjusted EBITDA margin of about 8.5% for the full year, and GES remains focused on disciplined cost management and efficiency gains from our lean productivity initiatives to drive additional benefit in years to come.
Steven Moster: As I mentioned earlier, based on the strength we are seeing in the business and our outperformance for the first half of 2024, I'm very pleased to announce that we are raising GES's adjusted EBITDA guidance by $5 million and now expect it to be in the range of $85 to $95 million. Now, on page 14, let's talk about GES's exciting plans for 2025 and continued profitable growth. CES is projecting flat revenue growth into 2025 despite the unfavorable impact of major non-annual shows.
Steven Moster: The team is focused on three levers for next year, moderate price increases, continued growth and net square footage of event space, and net new client wins of about $25 million. GES has a clear line of sight to approximately 90% of annual recurring revenue due to its long experience serving our largest clients as a trusted partner for their exhibition and event needs. Our relationships are generally structured under long-standing MSAs with corporate clients and contracts with show organizers to produce their exhibitions with 90% retention.
Steven Moster: TES Exhibitions is already selling and winning events for 2025 and beyond. The team recently won contracts for several large North American clients, including the International Association of Amusement Parks and Attractions, the Institute of Food Technologists, and the Congress for Neurological Surgeons. And Spyro continues to add to its client roster and work with existing clients to support them across a wider spectrum of experiential marketing activities. We feel confident in our ability to reach our targeted net new client wins for next year.
Steven Moster: Our proven track record of success and our ability to execute globally across both the exhibitions and experiential marketing sectors puts us in a unique position as a leader in this industry. Now, I'll turn the call over to David to discuss.
David Barry: Thanks, Steve. So I'll start off by discussing the wildfire in Jasper National Park, which remains active. So we're very grateful to the firefighters, first responders, Parks Canada team members, as well as the team members from the municipality of Jasper for their heroic efforts, as well as for the tremendous support Jasper has received from across the province, the nation, and around the world. Our community, our team, our incoming guests, and the restoration of Jasper remain our top priority.
David Barry: So, over the past 10 days or so, we've concentrated on aiding those impacted by the fire by providing emergency accommodation, meals, essential supplies, transportation, and the rebooking of many inbound trips. We're also working to secure housing solutions for our team members and those involved in re-entry efforts. So while about 30% of the Jasper town site has experienced significant devastation from the fire, 70% of the town, including homes, businesses, and hotels, were thankfully untouched by fire and are intact.
David Barry: All critical municipal infrastructure was successfully protected, and power is being restored as authorities work hard to reopen. We're also relieved that all the pursuit hotels and experiences in the Jasper Townsite, as well as our Pyramid Lake Lodge, Miette Mountain Cabins, and Maligne Lake Boat Cruise were not reached by fire. Our known property losses have been limited to the Moline Canyon Wilderness Kitchen, a restaurant and retail operation about 4.8 kilometers (3 miles outside the town of Joust).
David Barry: Work remains to be done for safe re-entry to the Jasper town site, and Parks Canada communicated that if current conditions continue, visitor services in the park are expected to resume on September 3rd. However, we're optimistic the southern area of Jasper National Park, which has not been threatened by fires, will reopen soon. And it is our understanding that the existing road closure of the Icefields Parkway could be lifted in the coming days, opening up access to the Columbia Icefield Glacier Adventure, the Glacier Skywalk, and the Glacier View Lodge.
David Barry: The PURSUIT team has responded incredibly to this situation and is prepared to resume operations as soon as authorities will allow it. And we look forward to being able to restart our JASPER operations. Our commitment to JASPER is unwavering, and we will continue to support the people and rebuilding efforts for as long as it takes.
Speaker Change: As soon as authorities will allow.
Speaker Change: And we look forward to being able to restart our Jasper operations and our commitment of Jasper is unwavering and we will continue to support the people and rebuilding efforts for as long as it takes we're looking forward to providing great hospitality experiences to our guests once again in Jasper National Park, when we're able.
David Barry: We're looking forward to providing great hospitality experiences to our guests once again in JASPER National Park when we're able. Now, I'd like to discuss Pursuit's first half of year performance, which set new records and the strong demand trends we're seeing across our collections of experiences. So I'll start with our attractions performance on page 16. Pursuit's Attractions Ticket Revenue grew 21% to $62 million year-to-date
Speaker Change: Now I'd like to discuss pursuits first half of the year performance, which set new records and the strong demand trends, we're seeing across our collection of experiences.
David Barry: This was driven by strong increases in visitors, which were up 14%, and growth in our effective ticket prices. Our same-store ticket revenue grew about 16% year-over-year with significantly higher effective ticket prices. Additionally, our new Flyover Chicago attraction, which we opened in March, was a meaningful contributor to the impressive increase in visitors. We're really pleased with our first four months of operation and the very favorable reviews that we've been getting. These one-of-a-kind point-of-interest attractions saw robust demand, and we benefited from our effective dynamic pricing strategy. Next on page 17, Pursuit's room revenue grew 8% to $32 million year to date, which was driven by demand and higher ADR.
Speaker Change: So I'll start with our attractions performance on page 16.
Speaker Change: Pursuits attractions ticket revenue grew 21% to $62 million year to date.
Speaker Change: This was driven by strong increases in visitors, which were up 14% and growth in our effective ticket prices are.
Speaker Change: Our same store ticket revenue grew about 16% year over year with significantly higher effective ticket prices. Additionally.
Speaker Change: Additionally, our new flyover, Chicago attraction, which reopened in March was a meaningful contributor to the impressive increase in visitors.
Speaker Change: We're really pleased with our first four months of operation and the very favorable reviews that we've been getting.
Speaker Change: Our one of a kind point of interest attractions saw robust demand and we benefited from our effective dynamic pricing strategy.
Next on page 17 pursuits room revenue grew 8% to $32 million year to date, which was driven by demand and capturing higher ADR.
David Barry: All geographies deliver growth and room revenue, with standout performance from our Canadian lodges as international travel to the destination is on the rise. The strength in our hospitality metrics is driven by perennial demand for our experiential travel destinations, our focus on providing a great guest experience, and seasonal compression in our market. Page 18 shows our lodging booking pace versus 2023, and this is looking solely at our properties outside of Jasper, and as you can see, room revenue on the bookings from our properties that are not impacted by fire closures is still pacing well ahead of last year. So just for a second, let's talk about what makes Pursuit so special and resilient.
Speaker Change: All geographies delivered growth in room revenue with standout performance from our Canadian lodges as international travel to the destination is on the rise.
Speaker Change: The strength in our hospitality metrics is driven by perennial demand for our experiential travel destinations our focus on providing a great guest experience.
Speaker Change: And seasonal compression in our markets.
Speaker Change: Page 18 shows our lodging booking pace versus 2023, and this is looking solely at our properties outside of Jasper and as you can see room revenue on the bookings from our properties that are not impacted by fire closures is still pacing well ahead of last year.
Speaker Change: So just for a second let's talk about what makes pursuit, so special and resilient first a point of interest attractions in lodging properties are located in remarkable places with strong perennial demand.
David Barry: First, our points of interest attractions and lodging properties are located in remarkable places with strong perennial demand, and everyone in the world loves a beautiful view. Second, our experiences have strong competitive moats in locations with significant barriers to entry. During peak summer season, our lodges reach nearly full occupancy with high demand and market compression. A range of ideally located lodging products provides robust cross-selling opportunities with our attractors. Third, we align our pricing with the value that we provide. So our strong guest reviews and net promoter scores reinforce our balanced approach to pricing and value.
Speaker Change: And everyone in the world loves a beautiful view.
Speaker Change: Our experiences have strong competitive moat and locations with significant barriers to entry.
Speaker Change: During peak summer season, our largest reached nearly full occupancy with high demand and market compression.
Speaker Change: A range of ideally located lodging product provides robust cross selling opportunities with our attraction.
Speaker Change: Third we align our pricing with the value that we provide.
So our strong guest reviews and net promoter scores reinforce our balanced approach the pricing and value perception.
David Barry: So while we may have uncertainty in the near term, our future remains bright. Now, let's move to page 19 and talk about our journey to meaningfully scale acquisition through our successful Refresh Build Buy strategy. We have an exciting pipeline of organic and inorganic investment opportunities to help accelerate our growth into the future. In 2024, we're investing approximately $20 million in build and refresh projects within our existing collection. This includes our newest build investment, Flyover Chicago, as well as other smaller refresh investments at well-instrumented and high-performing existing experiences where we see opportunities to generate incremental throughput and pricing power.
Speaker Change: So while we may have uncertainty in the near term our future remains bright.
Speaker Change: Now, let's move to page 19, and talk about our journey to meaningfully scale pursuit through our successful refresh build buy strategy.
Speaker Change: We have an exciting pipeline of organic and inorganic investment opportunities to help accelerate our growth into the future.
Speaker Change: In 2024, we're investing approximately $20 million into build and refresh projects within our existing collections.
Speaker Change: This includes our newest build investment fly over Chicago as well as other smaller refresh investments at well instrumented and high performing existing experiences, where we see opportunities to generate incremental throughput and pricing power.
David Barry: For example, we're in the process of upgrading the capacity of our top tier offering at Sky Lagoon to meet growing guest demand in Iceland. Additionally, we've identified many additional opportunities to expand our scale and market share in existing geographies through Tuckin acquisitions and other growth investments. An example of this is the Jasper Sky Tram, which is a one-of-a-kind asset and a great strategic fit for pursuit. We previously announced an agreement to acquire this attraction, but have not yet closed on the sale due to the wildfire activity in Jasper.
Speaker Change: For example, we are in the process of upgrading capacity of our top tier offering at Sky lagoon to meet growing guest demand in Iceland.
Speaker Change: We've identified many additional opportunities to expand our scale and market share in existing geographies through tuck in acquisitions and other growth investments.
Speaker Change: An example of this is the Jasper Sky <unk>, which is a one of a kind asset and a great strategic fit for pursuit.
Speaker Change: Previously announced an agreement to acquire this attraction, but have not yet closed on the sale due to the wildfire activity in Jasper.
David Barry: We remain very interested in adding it to our BAMF Jasper collection, and we'll be assessing any wildfire impacts prior to closing. We're also keenly interested in expanding our collection to new counter-seasonal geographies that will balance out our seasonality and diversify our footprint. You know, the world is a big place, and our growth aperture is wide. So as I conclude my remarks, I just want to say thank you once again to firefighters, emergency workers, Parks Canada teams, and the municipality of Jasper for their extraordinary efforts in this emergency. And, lastly, and probably super important for us, a big thank you to the thousands of team members across Pursuit for bringing their best every day.
Speaker Change: We remain very interested in adding it to our Banff Jasper collection, we will be assessing any wildfire impacts prior to closing.
Speaker Change: We're also keenly interested in expanding our collection to new counter seasonal geographies that will balance out our seasonality and diversify our footprint.
Speaker Change: The World is a big place and our growth aperture is wide.
Speaker Change: So as I conclude my remarks, I just want to say thank you once again to firefighters emergency workers parks, Canada teams in the municipality of Jasper for their extraordinary efforts and this emergency and lastly, and probably Super importantly for us a big Thank you to the thousands of team members across pursuit for bringing their best every day.
Alan: Alan over to you.
Ellen Ingersoll: Thanks, David. Now I'll cover the 2024 Outlook on page 21, starting with GES. GES delivered stronger than expected results for the first half of 2024, and the third quarter is looking strong. Based on that, we're increasing our full year EBITDA guidance range for GES to between 85 and 95 million, which is significantly above the 68.2 million in 2023. For the third quarter, we expect GES's adjusted EBITDA to be in the range of $15 to $19 million versus negative $2 million in the 2023 third quarter. This strong growth reflects a benefit of approximately $85 to $90 million from non-annual show revenue.
Alan: Thanks, David now I'll cover 2020 for outlook on page 21, starting with Ges.
Alan: Ges delivered stronger than expected results for the first half of 2024 in the third quarter is looking strong.
Alan: On that we are increasing our full year EBITDA guidance range for Ges $2 $85 million to $95 million, which is significantly above the $68 2 million in 2023.
Speaker Change: For the third quarter, we expect Ges's adjusted EBITDA to be in the range of $15 million to $19 million versus negative $2 million in the 2023 third quarter.
Alan: This strong growth reflects the benefit of approximately $85 million to $90 million from non annual show revenue.
Ellen Ingersoll: If not for the Jasper wildfires, we would have been in a position to raise our consolidated four-year guidance with key performance indicators for pursuit also trending very well. While it is challenging to predict the behavior of an active wildfire, Parks Canada is currently messaging a reopening date of September 3rd. Assuming that date holds, we estimate the EBITDA impact to pursuit could be somewhere around $20 to $25 million. Based on that scenario, we are reducing our full year guidance for pursuit adjusted EBITDA to $80 to $95 million as compared to $92.6 million in 2023.
Speaker Change: If not for the capture of wildfires, we would have been in a position to raise our consolidated full year guidance with key performance indicators or pursue also trending very well.
Speaker Change: While it is challenging to predict the behavior of an active wildfire parks, Canada is currently messaging are reopening date of September 3rd.
Alan: Assuming that date holds we estimate the EBITDA impact to pursuit could be somewhere around 20% to $25 million.
Speaker Change: Based on that scenario, we are reducing our full year guidance for pursuit, adjusted EBITDA to 80% to $95 million as compared to $92 6 million in 2023.
Ellen Ingersoll: And our guidance for Pursuit's third quarter adjusted EBITDA is $75 to $90 million, as compared to $91.8 million in the 2023 third quarter. As a result of these revisions, our consolidated full-year EBITDA guidance range is now $151 to $176 million, which is stronger than our 2023 adjusted EBITDA of $147 million.
Speaker Change: And our guidance for pursuit third quarter, adjusted EBITDA is $75 million to $90 million as.
Alan: <unk> $2 $91 8 million in the 2023 third quarter.
Alan: As a result of these revisions are consolidated full year EBITDA guidance range is now $151 million to $176 million, which.
Alan: Which is stronger than our 2023, adjusted EBITDA of $147 million.
Ellen Ingersoll: Clearly, there is a great deal of uncertainty in our guidance ranges for pursuits. We are doing our best to provide a realistic range based on what we know now, and we will provide updated guidance as appropriate. We are actively engaged with our insurance areas regarding the fire impacts in Jeff. Our policy limits are sufficient to cover our known property damage and our estimated loss of profits. However, I want to caution that our ability to recover business interruption is tied to property damage.
Alan: Clearly there is a great deal of uncertainty in our guidance ranges for pursuit.
Alan: Doing our best to provide a realistic range based on what we know now and we will provide updated guidance as appropriate.
Alan: We are actively engaged with our insurance areas regarding the fire impacts in Jasper.
Alan: Our policy limits are sufficient to cover our known property damage and our estimated loss of profits. However.
Speaker Change: However, I want to caution that our ability to recover business interruption is tied to property damage and will be highly fact determinants of based on what we learned when we are able to thoroughly inspect our properties alongside our insurance adjusters.
Ellen Ingersoll: It will be highly fact-determinative based on what we learn when we are able to thoroughly inspect our properties alongside our insurance adjusters. Much work needs to be done to understand the extent of potential insurance proceeds, and again, we will provide updates as appropriate. Steve, back to you. Thanks, Ellen.
Speaker Change: Much work needs to be done to understand the extent of potential insurance proceeds and again, we will provide updates as appropriate.
Speaker Change: Back to you.
Steven Moster: Thanks, Ellen. In closing, I want to thank our talented employees for their commitment and drive to deliver the best possible results for our clients, guests, and shareholders. And with that, we will open up the call to questions.
Speaker Change: Thanks, Alan and closing I want to thank our talented employees for their commitment and drive to deliver the best possible results for our clients guests and shareholders and with that we will open up the call for questions.
Operator: At this time, I would like to remind everyone that in order to ask a question, please press star, then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. The first question comes from the line of Tyler Batory with Oppenheimer. Your line is now open. Good afternoon, and thank you.
Speaker Change: At this time I would like to remind everyone that in order to ask a question. Please press Star then the number one on your telephone keypad, we'll pause for just a moment to compile the Q&A roster.
Speaker Change: The first question comes from the line of Tyler <unk> with Oppenheimer. Your line is now open.
Tyler Batory: Good afternoon. Thank you. I appreciate all the detail here.
Tyler Batory: And I understand it's a difficult, fluid situation in terms of what's going on in JASPER, but that's where I want to start with my questions. I know you disclose BAMF JASPER collection revenue. In a given year, are you able to break out how much is BAMF and how much is JASPER? And then, along with that, in terms of the guidance reduction, did you see any impact on cancellations in BAMF in July when the wildfire started in JASPER?
Tyler <unk>: Good afternoon, and thank you I appreciate all the detail here.
Tyler <unk>: I understand it's a difficult fluid situation in terms of what's going on in Jasper, but thats, where I wanted to start with my questions.
Speaker Change: I know you disclosed AAM Jasper collection revenue.
Speaker Change: And it gives them here are you able to break out how much is bam how much is Jasper and then along with that in terms of the guidance reduction did you see any impact on cancellations and Bam.
Speaker Change: In July when the wildfires started in Jasper.
David Barry: Yeah, so first, I'll start on the cancellation point. We really haven't seen any material cancellations, Tyler, at all.
Speaker Change: Yeah. So first I'll start on the cancellation point.
Speaker Change: We haven't seen any material cancellations Tyler at all.
Speaker Change: What you have actually happening and benefits there is compression as people are rerouting.
Speaker Change: Guests from Jasper and so again all of our major tour and travel partners are actively have guests in the geography, and so folks are moving from Jasper to bass as itineraries change and the business volumes and Vance will only get greater.
Speaker Change: We really don't breakout revenues and profits between Banff and Jasper and again, what I can tell you is that.
Speaker Change: The challenge with the situation in Jasper there are some positive elements to it one obviously, we're very empathetic to those that have lost their homes and those that have lost their businesses. As this is really a significant factor for them, but when you look at the number of say hotel rooms, Youre looking at basically 18% of hotel rooms and Josh.
Speaker Change: Or had been affected leaving 83% of hotel rooms in Jasper unaffected. So as we worked to reopening.
Speaker Change: Everyone is focused on that we still don't have access to the site, but that will improve in the days ahead and also we have some indication from parks, Canada, then it will be a matter of days not weeks before the Icl's Parkway is able to extend all the way up to tangle false which would allow the reopening of the glacier sky.
Speaker Change: Skywalk, the Columbia Icl's Discovery centre in the Glacier view Lodge, which we expect to be.
Speaker Change: Right.
Speaker Change: Okay. Okay.
Speaker Change: And then it's a positive.
Speaker Change: I'm talking about reopening.
Speaker Change: September 3rd which seems pretty pretty soon.
Speaker Change: Any sense for I mean are you seeing bookings for that be I mean are people canceling significantly given this given this news or are you proactively trying to discuss or talk with guests that have space for September into October.
Speaker Change: I know theres still not a lot that you that you know, but I'm just trying to get a sense of kind of what's in the guidance. What you are expecting after the September 30.
Speaker Change: Just kind of some of the some of the moving pieces and assumptions.
Speaker Change: Around about that perspective about that outlook.
David Barry: What you have actually happening in Banff is there's compression as people are rerouting guests from Jasper. And so again, all of our major tour and travel partners are actively having guests in the area. And so folks are moving from Jasper to Banff as itineraries change, and the business volumes in Banff will only get greater. We really don't break out revenues and profits between Banff and Jasper. And again, what I can tell you is that, you know, the challenge with the situation in Jasper, there are some positive elements to it.
Speaker Change: Yes, great question. Thank you I mean first let me start with the conversations that I've been having over the last 15 days. So I've had the great pleasure of reconnecting with our tour and travel partners and have talked to all of our major tour and travel partners across the globe together with our senior sales folks and so what's important to know there is that there is a.
David Barry: One, obviously, we're very empathetic to those that have lost their homes and those that have lost their businesses, as this is really a significant factor for them. But when you look at the number of, say, hotel rooms, you know, you're looking at basically 18% of hotel rooms in Jasper have been affected, leaving 83% of hotel rooms in Jasper unaffected. So as we work on the reopening, everyone is focused on that. We still don't have access to the site, but you know, that will improve in the days ahead.
David Barry: And also, we have some indication from Parks Canada that it will be a matter of days, not weeks, before the Icefields Parkway is able to extend all the way up to Tangle Falls, which would allow the reopening of the Glacier Skywalk, the Columbia Icefields Discovery Center, and the Glacier View Lodge, which we expect to be imminent.
Tyler Batory: Okay, okay. And then, you know, it's a positive.
Tyler Batory: Park Standard are talking about reopening on September 3rd, which seems pretty, pretty soon. Any sense for, I mean, are you seeing guest bookings for that day? I mean, are people canceling significantly given this news? Are you proactively trying to discuss or talk with guests that have stays from September into October? I'm just, you know, I know there's still not a lot that you know, but I'm just trying to get a sense of kind of what's in the guidance, what you're expecting after this September 3rd date, and, you know, just kind of some of the moving pieces and assumptions around that, that perspective, and that, and that outlook.
David Barry: Yeah, a great question. Thank you.
David Barry: I mean, first, let me start with the conversations that I've been having over the last 15 days. So I've had the great pleasure of reconnecting with our tour and travel partners. And I've talked to all of our major tour and travel partners across the globe, together with our senior sales folks. And so what's important to know is that there's a tremendous commitment to JASTA. And I think the way to think about it is to think of Western Canada as a big geography in which folks are traveling.
Speaker Change: Tremendous commitment adjustments and I think the way to think about it is to think of Western Canada as a big geography in which folks are traveling.
David Barry: And folks are traveling from Vancouver; they're traveling all the way through the Canadian Rockies on a specific itinerary. So our tour and travel partners are all very enthusiastic about the return to business, and they're excited to bring business back to Jasper the moment that they've got the green light. So that's a tremendous positive.
Speaker Change: Folks are traveling from Vancouver, they are traveling all the way through the Canadian Rockies on a specific itineraries. So our tour and travel partners are all very enthusiastic about the return to business.
Speaker Change: And they're excited to bring business back to Jos for the moment that they've got the green light. So that's a tremendous positive than today in Jasper as an example, cleanup teams and owners of the essential businesses like gas stations.
David Barry: And today in Jasper, as an example of cleanup teams and owners of essential businesses like gas stations, drugstores, and grocery stores are all mobilizing and have been granted access to their particular businesses, which helps us reach a point of reopening. And so each of those steps, as we accelerate along the way, we do have guests that have shifted itineraries, but we've also had a tremendous number of guests that have wanted to call and just, you know, provide a donation to those affected in Jasper. So I would say guest enthusiasm remains high.
Speaker Change: Sure.
Speaker Change: Drug stores grocery stores are all mobilizing and have been granted access to their particular businesses, which helps us travel to a point of reopening and so each of those steps as we accelerate along the way. We do have guests that have shifted itineraries, but we've also had a tremendous amount of guests that have wanted to call and just provide a donation.
Speaker Change: To those affected in Jasper So I would say guest enthusiasm remains high remember this is a very different situation than many of us saw with the horror of firing line out where an entire town was wiped out. This is 30% of the town is affected and imagine one side of the street you have buildings that have been destroyed but on the other side of the street.
David Barry: Remember, this is a very different situation than many of us saw with the horror of the fire in Lahaina, where an entire town was wiped out. This is 30 percent of the town affected. And imagine on one side of the street, you have buildings that have been destroyed. But on the other side of the street, you have basically, you know, flower baskets still hanging in the windows.
Speaker Change: Basically flower basket is still hanging in the window and so we have a tremendous amount of property that is untouched, 70% of town, 30% of property that is has been destroyed and a focus on rebuilding so we anticipate the return of business will be sooner and.
David Barry: And so you have a tremendous amount of property that is untouched, 70 percent of the town, 30 percent of property that has been destroyed, and a focus on rebuilding. So we anticipate the return to business will be sooner. And, you know, everyone is working in that regard toward that outcome. But there are no guarantees yet.
Speaker Change: Everyone is working in that regard towards that outcome theres no guarantees yet we have had some favorable weather in the last few days in terms of rain. So wildland fires of our controls all of the fire within the town of Jasper, obviously is well under control and there is no active fires at all within the town site and the team focused on managing traffic the high.
David Barry: We have had some favorable weather in the last few days in terms of rain, so wildland fires are more controlled. All of the fire within the town of Jasper is obviously well under control, and there are no active fires at all within the town site. And the team is focused on managing traffic. The highways have reopened east to west for commercial traffic, so there's actually commercial traffic and rail flowing through the town of Jasper.
Speaker Change: Ways of reopened east to west for commercial traffic. So there is actually commercial traffic and rail flowing through the town of Jasper and also just a final reminder, all the essential services in Jasper municipal infrastructure remain intact water sewer Hospital town Hall essential services fire station et cetera.
David Barry: And also, just a final reminder, all the essential services in Jasper municipal infrastructure remain intact. Water, sewer, hospital, town hall, essential services, fire station, et cetera, are all intact. So, I mean, as tough as this outcome has been, I think that everyone's managing to have a positive, positive end result with what they're facing.
Speaker Change: All intact, so I mean as toughest this outcome has been.
Speaker Change: I think that everyone's managing to a positive a positive end result, with what they are facing.
Tyler Batory: Okay, okay, very, very helpful commentary. Thank you.
Speaker Change: Okay. Okay very helpful commentary, Thank you I'll switch gears.
Speaker Change: <unk> side of things the margin there was tremendous in the.
Speaker Change: Quarter, so really nice to see that but was there anything one time that was established that was driving that and I'm interested in just the commentary in terms of the full year.
Speaker Change: Next year.
Speaker Change: It sounds consistent with what you said, which is obviously not a bad thing, but just wondering how much conservatism could be in that full year commentary just given how strong. The first half was kind of how strong the second quarter was as well.
Tyler <unk>: Yeah. Thanks, Thanks Tyler.
Tyler Batory: I'll switch gears, GES side of things. I mean, the margin there was tremendous in the quarter. So really nice to see that. Was there anything, you know, one time that was that was driving that? And, you know, I'm interested, just the commentary in terms of the full year and next year, kind of sounds consistent with what you said in the past.
Speaker Change: For the quarter I mean, I'm very pleased with both businesses you saw we had.
Steven Moster: Yeah, thanks, Tyler. For the quarter, I'm very pleased with both businesses. You saw that we had significant incremental revenue over prior years and a really good flow through to the bottom. A lot of that is a lot of the work that the team has done in prior quarters around the cost structure and preparing for a higher margin business as revenue continues to recover and grow. So, you know, there's no one specific thing that drives me.
Speaker Change: Significant incremental revenue over prior year.
Speaker Change: And a really good flow through to the bottom a lot of that is a lot of the work that the team has done.
Speaker Change: Your quarters around the cost structure and preparing for.
Speaker Change: Our higher margin business as revenue continues to recover and grow so.
Speaker Change: There is no one specific thing that drove obviously, we talked about.
Steven Moster: Obviously, we talked about just a minute ago about McDonald's being a contributor in the quarter. That's a large project that happened in the quarter, but there were other wins and other growth within exhibitions and within Spyro clients. So, overall, just a really strong continuation of the trend that we've seen where corporate clients are spending more and trade shows continue to increase in their size, and that both of those lead to really high flow-through to even a margin.
Speaker Change: Just a minute ago about Mcdonald's being a contributor in the quarter, that's a large project.
Speaker Change: That happened in the quarter, but there were other wins and other growth within exhibitions and within Spyros clients.
Speaker Change: So overall, just a really strong continuation of the trend that we've seen where corporate clients are spending more and trade shows continue to increase in their size and that both of those lead to.
Speaker Change: Really high flow through to EBITDA margin and then in terms of.
Steven Moster: And then in terms of, you know, our outlook for next year, you know, we've been, like you said, consistent in terms of what we believe will happen. We're, you know, a quarter more into or a quarter closer to 2025, and during the call, I wanted to highlight a couple of the wins that we've had. Those are a great indication of the momentum that both businesses have and really help us close that net new wind gap between here and 2025. So, you know, I feel good about where the year is headed. We're ahead of schedule, and as I look at 2025, you know, we're reaffirming what we project 2025 will look like. Okay.
Speaker Change: Our outlook for next year, we've been like you said, we've been consistent in Germany.
Speaker Change: What we believe will happen were.
Speaker Change: Quarter more into the quarter closer to 2025 and.
Speaker Change: During the call I wanted to highlight a couple of the wins that we've had.
Speaker Change: Those are great.
Speaker Change: Indication of the momentum that both businesses have and really help us close that net new wins.
Speaker Change: Gap between here and 2025 so.
Speaker Change: I feel good about where the year is headed obviously.
Speaker Change: We're ahead of schedule and as I look at 2025.
Speaker Change: We are reaffirming.
Speaker Change: What we project 25 will look like.
Tyler Batory: Okay. All right. That's all for me. I'll leave it there and pass it on. Thank you.
Speaker Change: Okay Alright.
Speaker Change: Alright, that's all from me I'll leave it there and pass it on thank you.
Tyler <unk>: Thanks Tyler.
Speaker Change: Thank you.
Bryan Maher: The next question is from the line of Bryan Maher with B. Reilly. Your line is now open.
Speaker Change: The next question is from the line of Bryan Mayer with B Riley. Your line is now open.
Bryan Maher: Great, thank you, and good afternoon everyone. Maybe Ellen could start off. You said some things about business interruption insurance and lost profit coverage, and I didn't quite understand business interruption being tied to property damage. Can you give us a little more color on how to think about that?
Bryan Mayer: Great. Thank you and good afternoon, everyone.
Bryan Mayer: Maybe for Alan to start off.
Bryan Mayer: Said, some things about the business interruption insurance and the lost profit coverage.
Bryan Mayer: I didn't quite understand the business interruption being tied to property damage can you give us a logo on color on how to think about that.
Ellen Ingersoll: The business interruption kicks in if we have property damage at the hotels, and that doesn't necessarily mean fire. It could be smoke damage, or it could be other water damage to the hotels. So what we have to do is we have to go in and assess what, if any, damage we have to our hotels, and then that determines our business interruption route. But it's going to be a long process, Bryan. There's a lot to figure out there.
Alan: Sure this business interruption kicks and if we have property damage at the hotels and that doesn't mean.
Speaker Change: Fire necessarily it could be smoke damage it could be other water damage to the hotels. So we have to do is we have to go in and assess what if any damage we have to our hotels and then that determines our business interruption.
Bryan Mayer: But it's going to be a long process, Brian there's a lot to there's a lot to figure out there.
Bryan Maher: Okay. Yeah. I mean, we, I'm sure Tyler and I and others have had experience with hurricane issues in Florida and the Caribbean with the hotel companies that we cover. So I know this can drag out, you know, literally for a couple of years.
Brian: Okay Yeah.
Speaker Change: Sure Tyler and I and others have had experience with hurricane issues in Florida, and the Caribbean with the hotels company at the E. Commerce. So I know this can drag out literally a couple of years.
Ellen Ingersoll: When you think about lost profit though, does the insurance company, though, look at maybe the fact that you may pick up incremental profit if your bomb hotels are packed because people aren't going to Jasper, or does that have to stay totally separate?
Brian: When you think about loss profit, though does the insurance company, though.
Speaker Change: Look at maybe the fact that you may pick up incremental profit if you or Bob hotels are packed because people aren't going to jasper or does that have to stay totally separate.
Bryan Maher: That's a good question. And that's going to be something that we'll have to talk to our insurance companies about. And we're not even close to that point yet. But it'll be a process. And we will strive to keep our Jasper properties separate and make sure that we get whatever is owed to us on the business interruption side related to those properties.
Speaker Change: That's a good question and that's going to be something that we will have to chapter our insurance companies about and we're not even close to that point yet.
Bryan Mayer: But it'll be a process and we will.
Speaker Change: We will strive to keep our Jasper properties separate and make sure that we get whatever so to us on the business interruption side related to those properties.
David Barry: Okay, thanks. Maybe shifting gears for David, the flyover Chicago, you know, good news that that opened up strong. Are there any key takeaways as to the opening of Chicago versus what you experienced in Las Vegas? And is there any update on Toronto?
Speaker Change: Okay. Thanks, maybe shifting gears.
Speaker Change: For David the flyover Chicago. Good news is that opened up strong are there any key takeaways as to the opening of Chicago versus what you experienced in Las Vegas.
Speaker Change: And is there any update on Toronto.
David Barry: Yeah, so let me start first with Chicago. Off to a roaring start. Really pleased with that.
David: Yes, So let me start first with Chicago off to a roaring start really pleased with that I think let's be honest Chicago is a less competitive market in Las Vegas in terms of attractions and so I would just say that the market dynamics are much more similar to Vancouver.
Speaker Change: Our.
Speaker Change: To Las Vegas, So Chicago and Navy Pier Navy Pier attracts a significant number of visitors.
David Barry: I think, let's be honest, Chicago is a less competitive market than Las Vegas in terms of attractions. And so I would just say that the market dynamics are much more similar to Vancouver than they are to, you know, Las Vegas. So Chicago and Navy Pier attract a significant number of visitors. And then also, the content and story are really compelling. It's a very soulful, emotional journey and a flight through Chicago that's pretty exhilarating because of the use of drone technology, etc.
Speaker Change: And then also the content and story is really compelling it's a very soulful.
Speaker Change: Emotional journey and a flight to Chicago, that's pretty exhilarating use of drone technology et cetera. So it's just really compelling content a tremendous location.
David Barry: So it's really compelling content, a tremendous location, a market that's adapted well to the flyover model and is performing really well. And we're happy with that. Now, let me switch channels to Toronto.
Speaker Change: A market that has adapted well to the flyover model and it's performing really well and we're happy with that.
David Barry: So obviously, this has been one of the most popular and longstanding questions on earnings calls, and I appreciate everyone's patience. We're in the final stages of executing a mutual agreement with the landowner, Canada Lands, to terminate our lease for that site. And it comes just from several years of working through the planning and permitting for the Flyover Toronto project. Given the escalation of costs and the explosion of construction in Toronto and the many challenges, it just became clear that this was the best outcome for us and for the landowner to terminate the lease. We're really excited to have done the work with Flyover that we have done, and we've grown to four platforms. And we're just focused on growing visits across our existing locations with our compelling attraction content.
Speaker Change: Let me switch channels to Toronto. So obviously this has been one of the most popular and long standing questions on earnings calls and I. Appreciate everyone's patience. We are in the final stages of executing a mutual agreement with the landowner, Canada lands to terminate our lease for that site.
Speaker Change: And it's kind of just from several years of working through the planning and permitting for the flyover Toronto project, given the escalation of costs and the explosion of construction in Toronto and in the many challenges. It just became clear that this was the best outcome for us and for the landowner to terminate the lease.
Speaker Change: We're really excited to have done the work with fly over that we've done and we've gone to four platforms and we're just focused on growing visits across our existing locations with our compelling attraction content.
Bryan Maher: Shifting gears, thanks for that. Shifting gears to Iceland and the volcanic activity that was the topic of conversation a quarter ago. Has that subsided, and is business at your competitor getting back to usual? Can you give us any color there?
Speaker Change: Shifting gears, thanks, Thats shifting gears to Iceland, and the volcanic activity that was <unk>.
Speaker Change: Topic of conversation a quarter ago as that subsided and his business at your competitor getting back to usual can you give us any color there.
David Barry: I won't speak so much to my competitor's business, but I will mention that, obviously, we're having a great summer in Iceland. Iceland is going to be on a track for record visitation in 2024. It's performed really well. It is true that volcanic activity ebbs and flows right now, but all appears calm on the peninsula in Iceland.
Speaker Change: Well speak so much to the business at my competitor, but I will mention that just for US obviously, we're having a great summer and Iceland, Iceland is going to be on track for record visitation in 2024, it's performed really well it is true the volcanic activity ebbs and flows right now it all appears com.
Speaker Change: And the peninsula in Iceland, and but again seeing great visitation.
Bryan Maher: And again, seeing great visitation, great support, fantastic guest reviews. And we're excited to launch the enlargement of the ritual at Sky Lagoon, which is our highest end product and gives us tremendous capacity, in addition to really hosting guests and providing a great experience.
Speaker Change: Great support fantastic guest reviews, and we're excited to launch the enlargement of the ritual at Sky Lagoon, which is our highest end product gives us tremendous capacity addition to.
Speaker Change: Two really host guest and provide a great experience so.
Speaker Change: Iceland is in good shape.
Bryan Maher: Well, we're all looking forward to the Investor Day in Iceland coming up. Maybe last for me, maybe back to Ellen, and sorry, Steve, to leave you out of it this time. But Tyler got my question on GES. When we think about your new numbers for pursuit, consistent with the thought that you won't get reopened in Jasper until September 3rd, if in fact, you get Columbia Icefield open, you know, in a matter of days or a week, Is there then an upside to what you're showing us now for pursuit numbers for the third quarter, should that happen?
Speaker Change: Well, we're all looking forward to the Investor day in Iceland.
Speaker Change: Tom.
Speaker Change: Uh huh.
Alan: Maybe last for me, maybe back to Alan and sorry, Steve to leave you out of at this time, but.
Speaker Change: Got my Clara and Ges.
Speaker Change: When we think about your new numbers for pursue consistent with the thought that you wont get reopened in Jasper until September 3rd if in fact, you get Colombia ice field open.
Speaker Change: A matter of days or a week.
Speaker Change: Is there then upside to what you're showing us now for pursuit numbers for the third quarter should that happen.
Ellen Ingersoll: Our assumptions... Current assumptions assume what David talked about, us getting the ice field open sooner than September 3rd. So I would say I wouldn't count on a lot of upsides, but the whole situation is so fluid, Bryan, that we could have some upside or some downside. It just depends on where we're at and if the September 3rd date holds, if ICE still does open in a week. But the assumptions that go into our guidance are what David talked about. Okay, thank you. That's all for me.
Speaker Change: Our assumptions.
Speaker Change: Current assumptions assume what David talked about us getting filled open sooner than September 3rd.
Speaker Change: So I would say I wouldn't count on a lot of upside.
Speaker Change: The whole situation is so fluid Brian that.
Speaker Change: We could have some upside or some downside it just depends on.
Speaker Change: Where we're at and if the September 30. It holds it still does open in a week, but the assumptions there.
Speaker Change: They go into our guidance are what David talked about.
Speaker Change: Okay. Thank you that's all for me.
Speaker Change: Thank you.
Alex Fuhrman: The next question is from the line of Alex Fuhrman with Craig Hallam. Your line is now open.
Speaker Change: The next question is from the line of Alex Fuhrman with Craig Hallum. Your line is now open.
Alex Fuhrman: Hey guys, thanks very much for taking my questions. You know, wanted to follow up, you know, more on the issue going on in Jasper. I mean, given the pretty significant impact to your business this year and the town site, you know, I know it's obviously a lot of uncertainties remain this year, but as you think about next year, you know, do you think it would be prudent for analysts to be building in some level of conservatism, you know, that it could perhaps be something of a multi-year recovery until you're back up to, you know, what you would have done this year without the wildfire, or, you know, is there hope that if there's guests returning to the town?
Alex Fuhrman: Hey, guys. Thanks, very much for taking my questions.
Speaker Change: Wanted to follow up.
Alex Fuhrman: More on on the issue going on in Jasper I mean, given the pretty significant impact to your business. This year and the outside I know, it's obviously a lot of uncertainties remain.
Speaker Change: This year, but as you think about next year do you think it would be prudent for analysts to be building in some level of conservatism.
Speaker Change: No.
Speaker Change: That it could perhaps be something of a multiyear recovery until you're back up to.
Speaker Change: What you would have done this year without the wildfire or you know.
Speaker Change: Is there is there hope that if theres guests returning to the town site as early as at ease in that next year could be pretty close to do a full season for you.
David Barry: Yeah, like I say, I think where I'll start with that is the reminder that, you know, we have been fortunate through this. The experience that our hotel properties are intact. They're located at the eastern end of town, so our neighbors, as well as ourselves, are sitting in a situation where our hotel properties are intact. Our neighbors to the southwest obviously have lost their hotel properties, which represents about 18% of the availability of lodging in Jasper. In my discussions with our tour and travel partners, demand is very strong, and we expect that to continue.
Speaker Change: Yes, let's say I think we're up to.
Speaker Change: Start with that is that a reminder, that we have been fortunate through this experience that our hotel properties are intact theyre located at the eastern end of town. So our neighbors as well as ourselves are sitting in a situation where our hotel properties are intact.
Speaker Change: Our neighbors to the southwest obviously have lost their hotel properties, which represents about 18%.
Speaker Change: Of the availability of lodging and Jasper.
Speaker Change: In my discussions with our tour and travel partners demand is very strong and we expect that to continue. So as you look ahead, we may face the opposite issue rather than taking more years to recover I think recovery could be accelerated just due to compression in lodging because theres. So many different tour and travel partners that are <unk>.
David Barry: So as you look ahead, we may face the opposite issue; rather than it taking more years to recover, I think recovery could be accelerated just due to compression in lodging. There are so many different tour and travel partners that are seeking accommodation for their itineraries, and when you eliminate 18% of a lodging bed base within a particular town, it pushes compression into other properties. The other thing that's important is that, you know, Jasper itself as a national park is 11,000 square kilometers.
Speaker Change: Thinking.
Speaker Change: Combination for their itineraries and when you eliminate 18% of our lodging bed base within a particular account it pushes compression into the properties. The other thing Thats important is that Jasper itself as a national Park is 11000 square kilometers.
David Barry: The fire, you know, fires, multiple fires, has affected, you know, basically 340 square kilometers, so 3% of the total area of Jasper National Park. When you think of that in hectares, which is interesting math, but, you know, 11,000 square kilometers is 1,100,000 hectares. The size of the fires is 34,000 hectares, so roughly 3%. So, what you know from all of this is that 3% of the visuals or 3% of the things that guests come to see have been affected, and a lot of these fires are outside the view angles of where guests are traveling.
Speaker Change: The fire.
Speaker Change: Fires multiple fires has affected basically 340 square kilometers so 3% of the total of Jasper National Park. When you think of that in sectors, which are interesting math, but 11000 square kilometers is $1 million 100 hectares.
Speaker Change: The fires is 34000 hectares, so roughly 3%.
Speaker Change: So what you know from all of this is that 3% of the visuals of 3% of the things that guests come to see have been affected and a lot of these fires are outside the view of where guests are traveling.
David Barry: So although we don't know all the details yet, I can tell you that the visual impact on the strength of the Icefields Parkway is strong, and Jasper remains strong in terms of its ability to attract visitors from around the world. And, you know, in discussions with our tour and travel partners, we see strong, sustained, confident demand for 25.
Speaker Change: So although we don't know all the details that I can tell you that the visual impact.
Speaker Change: The strength of the ICL Parkway Jasper remains strong in terms of its ability to attract visitors from around the world.
Speaker Change: And in discussions with our tour and travel partners, we see strong sustained confident demand for 'twenty five 'twenty six.
Speaker Change: Okay.
Alex Fuhrman: Okay, that's that's really helpful, David. Thank you. And then just as it relates to this year, you know, as you think about the range of outcomes and what's in your guidance, just the low end of guidance still contemplates guests coming back to your hotels in the Jasper town site this year. Can you just kind of help us work through the range of expectations and, and just, you know, how much housing would you have for your employees if you were able to have guests back next month?
Speaker Change: Okay. That's really helpful. David. Thank you and then just as it relates to this year you know as you think about the range of outcome and what's in your guidance.
Speaker Change: The low end of guidance.
Speaker Change: Still contemplate guests coming back.
Speaker Change: Our hotels in the Jasper town site this year.
Speaker Change: Can you just kind of help us work through the range of expectations and just how much housing would you out for your employees, if youre able to have get back next month.
David Barry: Why is present and always defers questions of guidance to the CFO? So I'll start with housing. You know, a question about housing is that we have team members, obviously, that are spread out over quite a distance. And we're doing a couple of different things for our team members. One, we're providing a steady stream of ongoing communication, financial support, mental health resources, housing, shelter, food, etc. That's the first thing.
Speaker Change: <unk> President always the first questions of guidance to the CFO, So I'll start with housing.
Speaker Change: A question on the housing is that we have team members, obviously that are spread out over quite a distance.
Speaker Change: And we're doing a couple of different things for our team members. One we're providing a steady stream of ongoing communications financial support mental health resources housing shelter food et cetera.
Speaker Change: That's the first thing second his team members are excited to get back to work. So as they returned to Jasper. If you think about it if you're a family of three living in a lovely hotel room is going to be fun for about the first four days and then youre going to want some other form of temporary housing. So the Alberta government together with parks, Canada is mobilizing to create those kinds of housing options.
David Barry: Second, team members are excited to get back to work. So as they return to Jasper, you know, if you think about it, if your family of three living in a lovely hotel room is going to be fun for about the first four days, and then you're going to want some other form of temporary housing. So the Alberta government, together with Parks Canada, is mobilizing to create those kinds of housing options.
Speaker Change: And then youre going to have a period of rebuild so you'll have a variety of different construction workers et cetera, and then you have overwhelming guest demand. So I think all of these things are going to contribute to it being busier than we anticipate and I'll defer to Alan on the guidance question.
Speaker Change: Yeah.
David Barry: And then you're going to have a period of rebuilding, so you'll have a variety of different construction workers, etc. And then you have overwhelming guest demand. So I think all of these things are going to contribute to it being busier than we anticipate. And I'll defer to Ellen on the guidance.
Alan: Sure Alex I'll, just say on the guidance, we have a set of key assumptions that we used to formulate the guidance and then put a range around that so any one of these assumptions could be better or worse.
Ellen Ingersoll: Sure, and Alex, I'll just say on the guidance. We have a set of key assumptions that we use to formulate the guidance and then put a range around that, so any one of these assumptions could be better or worse. But this is our best estimate right now, and then we put the range around that. Okay, then.
Alan: But this is our best and this is our best estimate right now and then we put the range around that.
Alex Fuhrman: Okay, that's really helpful. Thank you both.
Alex Fuhrman: Okay. That's really helpful. Thank you both.
Operator: Thank you. Again, if you'd like to ask a question, please dial star 1. The next question is from Will Bruneman with North Coast. Your line is now open.
Speaker Change: Thank you.
Speaker Change: If you'd like to ask a question please dial star one.
Speaker Change: Yeah.
Speaker Change: The next question is from will <unk> with Northcoast. Your line is now open.
Will Bruneman: Hey, how's it going, guys? So I was just curious, in your conversations with companies, are you seeing any hesitancy to spend on exhibits or events produced by SPIRO? And then I have a couple follow-ups, if that's all right. Sure.
Will: Hey, How's it going guys. So I was just curious in.
will <unk>: In your conversation with companies are you seeing any hesitancy to spend on exhibit sort of events produced by spiral.
Speaker Change: And then I have a couple of follow ups, if that's alright.
Steven Moster: Sure. Well, I mean, we have seen very strong corporate spending at Spiro, both for what we would call brand activations and corporate events, but also for exhibit programs for those corporations to attend trade shows. So, you know, as we've talked about for the last few quarters, it's been a steady, consistent growth in corporate spending from our clients that's led to our performance and outperformance relative to our expectations for the quarter, for sure.
Speaker Change: Sure.
Speaker Change: We have seen very strong corporate spending at Spiro.
Speaker Change: Both for what we would call brand Activations and corporate events, but also for.
Speaker Change: Exhibit programs for those corporations to attend trade shows.
Speaker Change: As we've talked about for the last few quarters, it's been a steady consistent growth in corporate spending from our clients that's led to our performance.
Speaker Change: Performance and outperformance relative to our expectations for the quarter for sure.
Will Bruneman: Okay, that's very helpful. Thank you. And then, when it comes to M&A opportunities, would Viad be open to acquisitions for the GES business? And then, on top of that, are you guys seeing any pricing concerns for GES and the pricing environment?
Speaker Change: Okay. That's very helpful. Thank you and then I was going to ask.
Speaker Change: When it comes to M&A opportunities.
Speaker Change: Would you open to acquisitions for the Ges business and then on top of that are you guys seeing any pricing concerns for ges and the pricing environment.
Steven Moster: I'll start with the pricing environment. So, you know, we are in a mode where we are pricing according to the quality and the capabilities that the team has and the product that we deliver. And so we continue to see price increases in the industry, as we have for the last couple of years. And I don't see any change in that, at least in the near future. In terms of M&A, our strategy and our capital allocation have been clear.
Speaker Change: I'll start with the pricing environment. So.
Speaker Change: We are.
Speaker Change: In a mode, where we are pricing according to the quality and the.
Speaker Change: The capabilities that the team has in the product that we deliver and so we continue to see price increases.
Speaker Change: The industry as we have for the last couple of years.
Speaker Change: And I don't see any change in that at.
Speaker Change: At least for the near future.
Speaker Change: In terms of M&A, our strategy and our capital allocation has been clear.
Steven Moster: For the last several years, we have been dedicated to growing and scaling Pursuit through the Refresh, Build, Buy strategy that we have in order to scale Pursuit and give VIAD more options into the future. It doesn't mean that we wouldn't look at things at GES, but from a priority perspective, our priorities remain the same, which is scaling Pursuit.
Speaker Change: For the last several years we have.
Speaker Change: <unk> been dedicated to growing and scaling pursued through the refresh build buy strategy that we have in order to scale pursuit and give the odd more options into the future.
Speaker Change: It doesn't mean that we wouldn't look at things that GDS, but from a priority perspective.
Speaker Change: Our priorities remain the same which is scaling pursue.
Will Bruneman: Okay. And then just one last thing. Maybe you already touched on this, but if the park opens back up, Jasper opens back up in 2025, but your visitation is compromised because of the fire, could you receive potentially insurance proceeds for that or anything along those lines?
Speaker Change: Okay, and then just one last thing.
Speaker Change: Maybe you already touched on this but if the park opens back up you know Jasper opens back up in 2025.
Speaker Change: But your visitation is compromised because of the fire could.
Speaker Change: Could you received potentially insurance proceeds for that or anything along those lines.
Speaker Change: Yeah.
Ellen Ingersoll: So, from an insurance perspective, what we're doing right now is assessing the damage that we would have to the hotels and what business interruption would come from that. The business interruption would be tracked. So, it would look at 24 and 25, and this will be a many-month process that we'll go through with our insurance carriers, so, yes, we will look at that as we go through this process. Obviously, the further away you get from the fire and, you know, the implications that David talked about, the further away you get, the less that we would... We would be expecting insurance proceeds, but we will not look at it until the business interruption case
Speaker Change: So from an insurance.
Speaker Change: <unk> perspective, what we're doing right now is assessing the damage that we would have to the hotels and what business interruption would come from that business interruption would be tracked.
Speaker Change: So it would it would look at 'twenty, four and 'twenty five and this will be in many month process that will go through with their insurance carriers. So yes, we will look at that as we go through this process. Obviously the further away you get from the fire.
Speaker Change: And the implications.
Speaker Change: <unk> that David talked about the further away you get the less.
Speaker Change: We would be expecting insurance proceeds that we will we will look at it until the bid.
Speaker Change: This interruption case subsides.
Will Bruneman: Okay, all right. Thank you guys for your help. I appreciate it.
Speaker Change: Okay Alright. Thank you guys for your help I appreciate it.
Paul: Thanks, Paul.
Operator: Thank you. There are no further questions at this time. Steve Moster, I turn the call back over to you. Thanks y'all.
Speaker Change: Thank you.
Speaker Change: No further questions at this time, Steve Master I turn the call back over to you.
Steven Moster: Thanks, Joel, and thanks to everybody for joining us for our earnings call today. We look forward to giving you an update in the near future. Thanks so much.
Steve Master: Thanks, Joe and thanks to everybody for joining us for our earnings call today, and we look forward to giving you an update in the near future. Thanks, So much.
Operator: This concludes today's conference call. You may now disconnect your line.
Speaker Change: This concludes today's conference call you may now disconnect your lines.
Speaker Change: Okay.