Convention management company posts revenue gain

In line with industry trends, Viad Corp.’s convention management business has begun to turn around.

During the fourth quarter ended Dec. 31, Viad’s marketing and events group posted a 9.8 percent revenue gain to $180.5 million, as conventions it handled in both 2010 and 2009 boosted their spending. For all of 2010, revenues rose 3.6 percent to $756.5 million, as business gained momentum in the year’s second half.

The increased activity and spending cuts implemented as booking slumped in the past couple of years helped cut the segment’s operating loss to $400,000 in the fourth quarter from
$7.2 million a year earlier.

For the full year, the marketing and events group’s loss fell to $5.1 million from $12.9 million in 2009.

Although the segment includes other subsidiaries, by far the largest part is Las Vegas-based GES Exposition Services, which handles a wide range of convention logistics through a national branch network.

“We have now had two straight quarters of same-show growth, so it finally feels like we have the wind at our backs again,” Viad CEO Paul Dykstra said. “We are seeing a lot more shows with growth than without. The general industry is continuing to improve.”

Revenue for Viad’s U.S. operations, which include GES, rose 7.6 percent in the quarter to $132 million and 0.4 percent for the year to $571 million. By contrast, the international operations growth rates ran 21.3 percent in the quarter and 14.6 percent in the year.

The domestic side showed operating losses, compared with the profits abroad. During the fourth quarter, for example, same-show revenue rose 16.6 percent, due largely to one big show with the resurging auto industry. But subtracting that, Dykstra said, same-show revenue still rose 5.4 percent.

Over the year, the meeting segment took several steps to cut overhead by $10 million, as the company continued to feel what Dykstra termed “pricing pressures.” Even as attendance and exhibitor counts have started to climb, show promoters have been reluctant to let go of discounts they obtained during the recession.

In 2011, the company projects same-show revenues will grow at a midsingle-digit percentage clip, but slow in the year’s latter half due to more difficult comparisons.

In the fourth quarter, Phoenix-based Viad had a net loss of $4.4 million, or 22 cents a share, compared with a net loss of $14.5 million, or 72 cents a share, a year earlier.

Quarterly revenues rose 9.9 percent to $187 million from $170.2 million.

For all of 2010, Viad had net income of $443,000, or 2 cents a share, reversing a net loss of $104.7 million, or $5.25 a share, a year earlier.

Twelve-month revenue rose 4.8 percent to $844.8 million from $805.8 million.

Viad shares fell 25 cents, or 1.08 percent Monday to close at $1.08, or $22.80 on the New York Stock Exchange.

Contact reporter Tim O’Reiley at
toreiley@reviewjournal.com or 702-387-5290.