(Former name, former address and former fiscal year, if changed since last report)

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

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

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

As of ~~October 27, 2017,~~August 2, 2023, there were ~~20,411,480~~20,879,009 shares of Common Stock ($1.50 par value) outstanding.

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

CONDENSED CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND MEZZANINE EQUITY (Continued)

Note 2. Revenue and Related Contract Costs and Contract Liabilities

Pursuit’s performance obligations are short-term in nature. They include the provision of a hotel room, an attraction admission, a chartered or ticketed bus or van ride, and/or the sale of food, beverage, or retail products. We recognize revenue when the service has been provided or the product has been delivered. When we extend credit, payment terms are generally within 30 days and contain no significant financing components.

GES’ performance obligations consist of services or product(s) outlined in a contract. While we often sign multi-year contracts for recurring events, the obligations for each occurrence are well defined and conclude upon the occurrence of each event. The obligations are typically the provision of services and/or sale of a product in connection with a live event. Revenue for goods and services provided for which we do not have control of the goods or services before that good or service is transferred to a customer is recorded on a net basis to reflect only the fees received for arranging these services. We recognize revenue for services generally at the close of the live event. We recognize revenue for products either upon delivery to the customer’s location, upon delivery to an event that we are serving, or when we have the right to invoice. In circumstances where a customer cancels a contract, we generally have the right to bill the customer for costs incurred to date. Payment terms are generally within 30-60 days and contain no significant financing components.

Contract Liabilities

Pursuit ~~is composed~~and GES typically receive customer deposits prior to transferring the related product or service to the customer. We record these deposits as a contract liability, which are recognized as revenue upon satisfaction of ~~Brewster Travel Canada,~~ the ~~Alaska Collection, Glacier Park, Inc.,~~related contract performance obligation(s). GES also provides customer rebates and ~~FlyOver Canada.~~volume discounts to certain event organizers that we recognize as a reduction of revenue. We include customer deposits in “Contract liabilities” and “Other deferred items and liabilities” in the Condensed Consolidated Balance Sheets.

Changes to contract liabilities are as follows:


(in thousands)
Balance at December 31, 2022	$	44,757
Cash additions		94,495
Revenue recognized		(65,082	)
Foreign exchange translation adjustment		(6,376	)
Balance at June 30, 2023	$	67,794

Contract Costs

GES capitalizes certain incremental costs incurred in obtaining and fulfilling contracts. Capitalized costs principally relate to direct costs of materials and services incurred in fulfilling services of future live events, and also include up-front incentives and commissions incurred upon contract signing. We expense costs associated with preliminary contract activities (i.e. proposal activities) as incurred. Capitalized contract costs are expensed upon the transfer of the related goods or services and are included in “Costs of services” or “Costs of products” as applicable. We include the deferred incremental costs of obtaining and fulfilling contracts in “Current contract costs” and “Other investments and assets” in the Condensed Consolidated Balance Sheets.

Changes to contract costs are as follows:


(in thousands)
Balance at December 31, 2022	$	16,568
Additions		30,443
Expenses		(26,216	)
Foreign exchange translation adjustment		312
Balance at June 30, 2023	$	21,107

~~Impact~~As of ~~Recent Accounting Pronouncements~~June 30, 2023, capitalized contract costs consisted of $0.1 million to obtain contracts and $21.0 million to fulfill contracts. We did not recognize an impairment loss with respect to capitalized contract costs during the three and six months ended June 30, 2023 or 2022.

Disaggregation of Revenue

The following ~~table provides~~tables disaggregate Pursuit and GES revenue by major service and product lines, timing of revenue recognition, and markets served:

Pursuit


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in thousands)	2023		2022		2023		2022
Services:
Ticket revenue	$	36,543	$	29,337	$	50,804	$	38,539
Rooms revenue		22,106		20,559		29,696		27,462
Transportation		3,689		3,755		5,634		4,934
Other		3,333		3,017		4,700		4,387
Total services revenue		65,671		56,668		90,834		75,322
Products:
Food and beverage		13,628		12,171		19,503		16,264
Retail operations		9,175		8,760		10,800		9,797
Total products revenue		22,803		20,931		30,303		26,061
Total revenue	$	88,474	$	77,599	$	121,137	$	101,383

Timing of revenue recognition:
Services transferred over time	$	65,671	$	56,668	$	90,834	$	75,322
Products transferred at a point in time		22,803		20,931		30,303		26,061
Total revenue	$	88,474	$	77,599	$	121,137	$	101,383

Markets:
Banff Jasper Collection	$	46,905	$	38,962	$	64,519	$	53,292
Alaska Collection		12,701		13,319		13,154		13,816
Glacier Park Collection		13,730		13,581		15,185		14,590
FlyOver		7,020		5,870		12,875		10,009
Sky Lagoon		8,118		5,867		15,404		9,676
Total revenue	$	88,474	$	77,599	$	121,137	$	101,383

GES


	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2023			2022			2023			2022
Service lines:
Spiro	$	80,368		$	89,425		$	140,730		$	132,241
GES Exhibitions		154,534			154,600			324,031			266,431
Intersegment eliminations		(3,065	)		(2,421	)		(4,796	)		(3,492	)
Total revenue	$	231,837		$	241,604		$	459,965		$	395,180

Timing of revenue recognition:
Services transferred over time	$	196,668		$	197,464		$	389,645		$	329,947
Products transferred over time(1)		16,038			16,025			28,979			23,963
Products transferred at a point in time		19,131			28,115			41,341			41,270
Total revenue	$	231,837		$	241,604		$	459,965		$	395,180

Geographical markets:
North America	$	177,408		$	189,670		$	358,247		$	318,697
EMEA		62,644			58,534			112,181			84,347
Intersegment eliminations		(8,215	)		(6,600	)		(10,463	)		(7,864	)
Total revenue	$	231,837		$	241,604		$	459,965		$	395,180

(1)

GES’ graphics product revenue is earned over time over the duration of an event as it is considered a ~~brief description~~part of ~~recent accounting pronouncements:~~

~~Standard~~	~~Description~~	~~Date of adoption~~	~~Effect on the financial statements~~
~~Standards Not Yet Adopted~~
~~ASU 2014-09~~, ~~Revenue from Contracts with Customers (Topic 606)~~	The standard establishes a new recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The Company may adopt either retrospectively to each prior period presented with the option to elect certain practical expedients or with the cumulative effect recognized at the date of initial application and providing certain disclosures. Subsequent to the issuance of ASU 2014-09, the FASB issued several amendments in 2016 which do not change the core principle of the guidance stated in ASU 2014-09. Rather, they are intended to clarify and improve understanding of certain topics included within the revenue standard.	~~January 1, 2018~~	The Company is currently evaluating the impact of the adoption of this new guidance on its financial position or results of operations including analyzing its current portfolio of customer contracts. The Company has assigned internal resources in addition to the engagement of a third-party service provider to assist in the evaluation of the impact on its accounting policies, processes, and system requirements. Based on the Company’s preliminary assessment, the adoption of this standard will not have a material impact on Viad’s consolidated financial statements. Although significant additional disclosures will be required, the Company expects the immaterial impact to primarily relate to the deferral of certain commissions which were previously expensed as incurred but will generally be capitalized and amortized over the period of contract performance, and the deferral of certain costs incurred in connection with trade shows which were previously expensed as incurred but will generally be capitalized and expensed upon the completion of the show. The Company will adopt the standard on January 1, 2018 and will be using the modified retrospective transition method. Additionally, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. The Company is continuing its assessment, which may identify other impacts.
~~ASU 2016-02~~, ~~Leases (Topic 842)~~	The amendment requires lessees to recognize on their balance sheet a right-of-use asset and a lease liability for leases with lease terms greater than one year. The amendment requires additional disclosures about leasing arrangements, and requires a modified retrospective approach to adoption. Early adoption is permitted.	~~January 1, 2019~~	The Company is currently evaluating the potential impact of the adoption of this new guidance on its financial position or results of operations including analyzing its existing operating leases. Based on the Company’s current assessment, the adoption of this standard will have a material impact on Viad’s consolidated balance sheets, but the income statement is not expected to be materially impacted. The Company expects the most significant impact will relate to facility and equipment leases and embedded lease arrangements which are currently recorded as operating leases. The Company is continuing its assessment, which may identify other impacts. The Company will adopt the standard on January 1, 2019.
~~ASU 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments~~	The amendment provides guidance on eight specific cash flow issues with the objective of reducing the existing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. Early adoption is permitted.	~~January 1, 2018~~	~~The adoption of this new guidance is not expected to have a significant effect on Viad’s financial position or results of operations.~~
~~ASU 2016-16~~, ~~Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory~~	The amendment eliminates an exception in ASC 740 which prohibits the recognition of current and deferred income tax effects for intra-entity transfers of assets other than inventory until the asset has been sold to an outside party. The amendment requires an entity to recognize the income tax consequences of intra-entity transfers of assets other than inventory at the time that the transfer occurs.	~~January 1, 2018~~	~~The adoption of this new guidance is not expected to have a significant effect on Viad’s financial position or results of operations.~~

the single performance obligation satisfied over time.

~~Standard~~	~~Description~~	~~Date of adoption~~	~~Effect on the financial statements~~
~~Standards Not Yet Adopted (Continued)~~
~~ASU 2017-01~~, ~~Business Combination (Topic 805) - Clarifying the Definition of a Business~~	~~The amendment provides guidance on evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.~~	~~January 1, 2018~~	~~The adoption of this new guidance is not expected to have a significant effect on Viad’s consolidated financial statements.~~
~~ASU 2017-04~~, ~~Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment~~	The amendment eliminates the requirement to estimate the implied fair value of goodwill if it was determined that the carrying amount of a reporting unit exceeded its fair value. Goodwill impairment will now be recognized by the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The amendment should be applied prospectively and is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017.	~~January 1, 2020~~	The adoption of this new guidance is not expected to have a significant effect on Viad’s consolidated financial statements and the Company expects the adoption to reduce the complexity surrounding the analysis of goodwill impairment.
~~ASU 2017-07~~, ~~Compensation - Retirement Benefits (Topic 715) - Improving the Presentation of Net Periodic Pension~~ ~~Cost and Net Periodic Postretirement Benefit Cost~~	The amendment requires an employer to disaggregate the service cost components from the other components of net benefit cost. The service cost components are required to be presented in operating income and the other components of net benefit cost are required to be presented outside of operating income.	~~January 1, 2018~~	The Company currently presents all components of net periodic pension and postretirement benefit costs in cost of services in the consolidated statements of operations. The adoption of this new guidance is not expected to have a significant effect on Viad’s consolidated financial statements.
~~ASU 2017-09~~, ~~Compensation - Stock Compensation (Topic 718) - Scope of Modification Accounting~~	~~The amendment provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718.~~	~~January 1, 2018~~	The Company grants share-based awards but rarely has modifications to the awards. The adoption of this new guidance is not expected to have a significant effect on Viad’s consolidated financial statements.


~~Standards Recently Adopted~~
~~ASU 2015-11, Inventory (Topic 330) - Simplifying the Measurement of Inventory~~	The amendment applies to inventory measures using first-in, first-out or average cost and requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the normal course of business, minus the cost of completion, disposal and transportation. Replacement cost and net realizable value less a normal profit margin will no longer be considered.	~~January 1, 2017~~	~~The adoption of this new guidance did not have a significant effect on Viad’s consolidated financial statements.~~
~~ASU 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting~~	The amendment identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows.	~~January 1, 2017~~	The adoption of this new guidance resulted in a decrease of 6% to the effective tax rate during the first quarter of 2017 as compared to 2016, and resulted in a decrease of 1% to the effective tax rate during the nine months ended September 30, 2017 as compared to 2016.

Note 2. 3. Share-Based Compensation

~~The following table summarizes~~We grant share-based compensation ~~expense:~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

2017

2016

Performance unit incentive plan (“PUP”)

$
3,941

$
1,601

$
7,184

$
2,952

Restricted stock

672

523

2,069

1,597

Restricted stock units

124

86

231

160

Share-based compensation before income tax benefit

4,737

2,210

9,484

4,709

Income tax benefit

(1,752
)

(812
)

(3,524
)

(1,750
)
Share-based compensation, net of income tax benefit

$
2,985

$
1,398

$
5,960

$
2,959

~~Viad did not record any share-based compensation expense through restructuring expense during~~awards to our officers, directors, and certain key employees pursuant to the ~~three months ended September 30, 2017 or 2016, and recorded zero and $0.2 million for the nine months ended September 30, 2017 and 2016, respectively.~~

~~The following table summarizes the activity of the outstanding share-based compensation awards:~~

PUP Awards

Restricted Stock

Restricted Stock Units

Shares

Weighted-Average
Grant Date
Fair Value

Shares

Weighted-Average
Grant Date
Fair Value

Shares

Weighted-Average
Grant Date
Fair Value

Balance at December 31, 2016

255,505

$
26.11

267,051

$
25.96

15,982

$
25.58

Granted

73,557

$
47.44

64,648

$
46.64

2,950

$
47.45

Vested

(76,082
)

$
23.66

(79,104
)

$
24.01

(6,182
)

$
25.05

Forfeited

(5,911
)

$
30.64

(9,807
)

$
33.84

—

$
—

Balance at September 30, 2017

247,069

$
33.10

242,788

$
31.79

12,750

$
30.90

~~Viad Corp Omnibus Incentive Plan~~

~~The~~ 2017 Viad Corp Omnibus Incentive Plan, as amended (the “2017 Plan”) ~~was approved by Viad stockholders and was effective May 18, 2017. The 2017 Plan replaced the Company’s 2007 Viad Corp Omnibus Stock Plan (the “2007 Plan”)~~. ~~No further awards may be made under the 2007 Plan, although awards previously granted under the 2007 Plan will remain outstanding in accordance with their respective terms.~~ The 2017 Plan has a 10-year ~~life~~ term and provides for the following types of awards: (a) incentive and non-qualified stock ~~options,~~options; (b) restricted stock awards and restricted stock ~~units,~~units; (c) performance units or performance ~~shares,~~shares; (d) stock appreciation ~~rights,~~rights; (e) cash-based ~~awards,~~awards; and (f) certain other stock-based awards. In June 2017, ~~Viad registered~~ we reserved 1,750,000 shares of common stock ~~issuable~~for issuance under the 2017 Plan. On May 24, 2022, we amended and restated the 2017 Plan, which among other things, increased the number of shares reserved for issuance under the 2017 Plan by 840,000 shares, bringing the total number of reserved shares to 2,590,000. As of ~~September~~June 30, ~~2017,~~2023, there were ~~1,746,927~~880,838 shares available for future grant under the 2017 Plan.

The following table summarizes share-based compensation expense:

~~PUP Awards~~


	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2023			2022			2023			2022
Performance-based restricted stock units	$	819		$	705		$	1,641		$	719
Restricted stock awards and restricted stock units		1,681			1,787			3,324			3,349
Stock options		347			811			947			1,401
Share-based compensation expense before income tax		2,847			3,303			5,912			5,469
Income tax benefit(1)		(44	)		(30	)		(66	)		(47	)
Share-based compensation expense, net of income tax	$	2,803		$	3,273		$	5,846		$	5,422

(1)

The 2023 and 2022 income tax benefit amount primarily reflects the tax benefit associated with our Canadian-based employees.

Note 4. Acquisition and Disposition

In February 2016, the PUP Plan was amended to provide that PUP awards earned under the 2007 Plan may be payable in the form of cash or in shares of Viad common stock (or a combination of both). Previously, payouts could only be made in cash. The vesting of shares is based upon achievement of certain performance-based criteria. The performance period of the shares is three years.2022 Acquisition

During the nine months ended September 30, 2017, Viad granted $3.5 million of PUP awards of which $1.4 million are payable in shares. As of September 30, 2017 and December 31, 2016, Viad had recorded liabilities of $10.3 million and $7.6 million, respectively, related to PUP awards. In March 2017, the PUP awards granted in 2014 vested and cash payouts of $3.7 million were distributed. In March 2016, the PUP awards granted in 2013 vested and cash payouts of $0.2 million were distributed.Glacier Raft Company

~~Restricted Stock~~

As of September 30, 2017, the unamortized cost of all outstanding restricted stock awards was $3.1 million, which Viad expects to recognize in the consolidated financial statements over a weighted-average period of approximately 1.2 years. During the nine months ended September 30, 2017 and 2016, the Company repurchased 26,916 shares for $1.3 million and 24,432 shares for $0.7 million, respectively, related to tax withholding requirements on vested share-based awards.

~~Restricted Stock Units~~

As of both September 30, 2017 and December 31, 2016, Viad had aggregate liabilities recorded of $0.4 million related to restricted stock units. In February 2017, portions of the 2012 and 2014 restricted stock units vested and cash payouts of $0.3 million were distributed. In February 2016, portions of the 2011, 2012, and 2013 restricted stock units vested and cash payouts of $0.2 million were distributed.

~~Stock Options~~

During the three and nine months ended September 30, 2017, there was no stock option activity. As of both September 30, 2017 and December 31, 2016, there were 63,773 stock options outstanding and exercisable with a weighted-average exercise price of $16.62. As of September 30, 2017, there were no unrecognized costs related to non-vested stock option awards.

~~Note 3.~~ ~~Acquisition of Businesses~~

~~FlyOver Canada~~

On ~~December 29, 2016, the Company~~April 6, 2022, we acquired the ~~assets~~Glacier Raft Company, which provides guided river rafting trips operating in Pursuit’s West Glacier, Montana operations. The Glacier Raft Company also owns 13 log cabins, a lodge, and ~~operations of FlyOver Canada,~~ a ~~recreational attraction that provides a virtual flight ride experience~~wedding venue located on 50 acres with ~~a combination of motion seating, spectacular media, and visual effects including wind, scents, and mist.~~views into Glacier National Park. The purchase price was ~~$68.8~~$26.5 million ~~Canadian dollars (approximately $50.9~~in cash. This acquisition was funded via cash on hand of approximately $11.5 million ~~U.S. dollars) in cash, subject to certain adjustments.~~and borrowings under our revolving credit facility of $15.0 million.

The following table summarizes the final allocation of the aggregate purchase price ~~paid~~ and ~~the~~ amounts of assets acquired and liabilities assumed based onupon the estimated fair value asat the date of acquisition. During the ~~acquisition date. The allocation~~first quarter of 2023, we made a purchase accounting measurement period adjustment of approximately $41,000 to working capital based on refinements to assumptions used in the ~~purchase price was completed as of March 31, 2017.~~ preliminary valuation.

(in thousands)

Purchase price paid as:

Cash

$
50,920

Cash acquired

(6
)
Purchase price, net of cash acquired

50,914

Fair value of net assets acquired:

Inventories

$
11

Prepaid expenses

37

Property and equipment

10,867

Intangible assets

6,028

Total assets acquired

16,943

Accrued liabilities

118

Total liabilities assumed

118

Total fair value of net assets acquired

16,825

Excess purchase price over fair value of net assets acquired (“goodwill”)

$
34,089


(in thousands)
Purchase price paid as:
Cash	$	26,507
Working capital adjustment		(920	)
Purchase price adjustment		125
Cash acquired		(177	)
Purchase price, net of cash acquired		25,535

Fair value of net assets acquired:
Inventory		370
Prepaid expenses and other		57
Property and equipment		6,487
Intangible assets		3,400
Total assets acquired		10,314
Customer deposits		1,575
Other current liabilities		32
Total liabilities assumed		1,607
Total fair value of net assets acquired		8,707
Excess purchase price over fair value of net assets acquired (“goodwill”)	$	16,828

Under the acquisition method of accounting, the purchase price as shown in the table above is allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over the fair value of net assets acquired was recorded as ~~goodwill.~~“Goodwill.” Goodwill ~~of FlyOver Canada~~relating to the Glacier Raft Company acquisition is included in the Pursuit ~~business group and is a separate reporting unit.~~reportable segment. The primary factor that contributed to the purchase price resulting in the recognition of goodwill ~~relates~~related to future growth opportunities ~~and the expansion of the FlyOver concept.~~when combined with our other businesses. Goodwill is ~~expected to be~~ deductible for tax ~~purposes pursuant to Canadian tax regulations. The estimated values of current~~purposes. We included these assets ~~and liabilities were based upon their historical costs on~~in the Condensed Consolidated Balance Sheets from the date of ~~acquisition due to their short-term nature. Transaction costs associated with~~acquisition.

Following are details of the ~~acquisition of FlyOver Canada were $0.1 million in 2017 and $0.5 million in 2016 and are included in cost of services in Viad’s condensed consolidated statements of operations.~~

Identified intangible assets acquired in the FlyOver Canada acquisition totaled $6.0 million and consisted of trade names of $3.7 million, customer relationships of $1.6 million, and non-compete agreements of $0.7 million. The weighted-average amortization period relatedpurchase price allocated to the intangible assets ~~is 9.4 years.~~acquired for the Glacier Raft Company:


(in thousands)	Amount		Weighted Average Life
Customer relationships	$	1,800	12 years
Operating licenses		1,300	17 years
Trade name		300	8 years
Total	$	3,400	14 years

The results of operations of ~~FlyOver Canada~~the Glacier Raft Company have been included in ~~Viad’s condensed~~the consolidated financial statements from the date of acquisition. During the three and nine months ended September 30, 2017, revenue related to FlyOver Canada was $4.2 million and $8.0 million, respectively, and operating income was $2.2 million and $2.5 million, respectively.

~~Other Acquisitions~~

~~In March 2017, the Company~~2022 Disposition

ON Services

On December 15, 2022, we completed the ~~acquisition~~sale of substantially all of the ~~Poken event engagement technology~~assets of GES’ United States audio-visual production business, ON Services – AV Specialists, Inc. (“ON Services”), for ~~total cash consideration of $1.7~~approximately $30.0 million, subject to ~~certain~~customary working capital adjustments. ~~These~~We recognized a gain on sale of $19.6 million. During the second quarter of 2023, we made a sale purchase price adjustment of approximately $0.2 million. ON Services had a net carrying value of $10.4 million, which included $4.9 million of net working capital and net non-current assets ~~have been included~~of $5.5 million. Working capital consisted primarily of accounts receivable of $8.2 million and other current assets of $0.7 million, offset in ~~Viad’s condensed consolidated financial statements from the date~~part by current liabilities of ~~acquisition.~~

~~Supplementary pro forma financial information~~

$4.0 million. Net non-current assets consisted primarily of property and equipment of $6.0 million, offset in part by other liabilities of $0.5 million. The ~~following table summarizes the unaudited pro forma results of operations attributable to Viad, assuming the 2016 acquisitions of CATC Alaska Tourism Corporation (“CATC”) (acquired March 2016), the~~staging business of ON ~~Event~~ Services ~~LLC (“~~was included in the Spiro reportable segment and the venue services business in the United States was included in the GES Exhibitions reportable segment.

The ON ~~Services”) (acquired August 2016),~~Services sale did not represent a strategic shift that has or will have a major effect on our operations and ~~FlyOver Canada (acquired December 2016) had been completed on January 1, 2016:~~financial results, and therefore was not classified as a discontinued operation for any of the periods presented.

Note 5. Inventories

We state inventories, which consist primarily of exhibit design and construction materials and supplies, as well as retail inventory, at the lower of cost (first-in, first-out and specific identification methods) or net realizable value.

Three Months Ended

Nine Months Ended

(in thousands, except per share data)

September 30, 2016

September 30, 2016

Revenue

$
389,877

$
991,818

Depreciation and amortization

$
14,427

$
39,565

Income from continuing operations

$
35,047

$
47,734

Net income attributable to Viad

$
33,834

$
46,198

Diluted income per share

$
1.67

$
2.28

Basic income per share

$
1.67

$
2.28

~~Note 4.~~ ~~Inventories~~

The components of inventories consisted of the following:


	June 30,		December 31,
(in thousands)	2023		2022
Raw materials	$	1,153	$	1,403
Finished goods		14,691		9,382
Inventories	$	15,844	$	10,785

September 30,

December 31,

(in thousands)

2017

2016

Raw materials

$
18,455

$
16,846

Work in process

21,298

14,574

Inventories

$
39,753

$
31,420

Note 5. 6. Other Current Assets

Other current assets consisted of the following:


	June 30,		December 31,
(in thousands)	2023		2022
Restricted cash	$	7,881	$	4,845
Prepaid software maintenance		5,848		4,650
Prepaid project deposit		3,699		3,615
Prepaid vendor payments		2,805		2,084
Income tax receivable		1,498		322
Prepaid taxes		1,036		142
Prepaid other		2,055		1,836
Other		2,236		1,483
Other current assets	$	27,058	$	18,977

Depreciation expense was ~~$12.5~~$10.5 million ~~and $10.0 million for~~during the three months ended ~~September~~June 30, ~~2017~~2023 and ~~2016, respectively, and $32.9~~$20.9 million ~~and $25.1 million for~~during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023. Depreciation expense was $10.8 million during the three months ended June 30, 2022 and ~~2016, respectively.~~$21.8 million during the six months ended June 30, 2022.

~~Non-cash increases to property~~Property and equipment related to assets acquired under capital leases were $1.1 million and $1.0 million for the nine months ended September 30, 2017 and 2016, respectively. Non-cash increases to property and equipment purchases inpurchased through accounts payable and accrued liabilities ~~were $0.8~~decreased $1.3 million ~~and $5.6 million for~~during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 and ~~2016, respectively.~~decreased $0.4 million during the six months ended June 30, 2022. Capitalized interest was $0.5 million during the three months ended June 30, 2023 and $0.7 million during the six months ended June 30, 2023. Capitalized interest was $0.7 million during the three months ended June 30, 2022 and $2.6 million during the six months ended June 30, 2022, which was primarily related to the development of Pursuit’s FlyOver attractions.

Effective July 30, 2021, we entered into a $500 million credit facility (the “2021 Credit Facility”). The 2021 Credit Facility provides for a $400 million term loan (“Term Loan B”) and a $100 million revolving credit facility (“Revolving Credit Facility”). 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 then $450 million revolving credit facility and to provide for financial flexibility to fund future acquisitions and growth initiatives and for general corporate purposes.

On February 6, 2023, we entered into the LIBOR Transition Amendment to the 2021 Credit Facility to replace the London Interbank Offered Rate (“LIBOR”) with the Secured Overnight Financing Rate (“SOFR”). In accordance with the LIBOR replacement provisions outlined in the 2021 Credit Facility, additional credit spread adjustments apply to SOFR ranging from 0.11448% (for a one-month duration) up to 0.71513% (for a 12-month duration).

The Term Loan B has a maturity date of July 30, 2028 and is subject to quarterly amortization of principal of $1.0 million. Interest rates are based on SOFR (plus additional credit spread adjustments as detailed above under “LIBOR Transition Amendment”) plus a 5.00% credit spread, with a SOFR floor of 0.50%. The Term Loan B carries no financial covenants.

As discussed in Note 13 – Derivative, we entered into an interest rate cap agreement that manages our exposure to interest rate increases on $300 million of borrowings under the Term Loan B and provides us with the right to receive payment if the one-month SOFR exceeds 5.0% (“strike rate”).

The Revolving Credit Facility has a maturity date of July 30, 2026. As of June 30, 2023, capacity remaining under the Revolving Credit Facility was $95.0 million, reflecting $100.0 million total facility size, less $5.0 million in outstanding letters of credit.

In addition to borrowing based on one, three, six, or twelve month SOFR tenors (plus additional credit spread adjustments as detailed above under “LIBOR Transition Amendment”), we also have the option to borrow based on the “Base Rate”, which for any day is a fluctuating rate equal to the highest of the Fed Funds Rate plus 0.50%, Bank of America’s publicly announced “prime rate”, and SOFR plus 1.00%. Credit spreads for SOFR and Base Rate borrowings are based on Viad’s total net leverage ratio and range from 2.50% to 3.50% for SOFR borrowings and from 1.50% to 3.50% for Base Rate borrowings. Additionally, a 1.00% floor applies to the Bate Rate.

The Revolving Credit Facility includes an undrawn fee ranging from 0.30% to 0.50% that is based on Viad’s total net leverage ratio.

The Revolving Credit Facility carries financial covenants. On March 23, 2022, we entered into the First Amendment to the 2021 Credit Facility and on March 28, 2023, we entered into the Second Amendment to the 2021 Credit Facility. The amendments modified the financial covenants to the following:

As of June 30, 2023, our total net leverage ratio was 2.91 to 1.00, the interest coverage ratio was 3.02 to 1.00, and we were in compliance with all covenants under the Revolving Credit Facility.

In addition to U.S. dollar borrowings, we may borrow funds on the Revolving Credit Facility in Canadian Dollars based on the Canadian Dollar Offered Rate, Pound Sterling based on the Sterling Overnight Index Average, and Euros based on the Euro Interbank Offered Rate, plus applicable credit spreads. No such borrowings had been made as of June 30, 2023.

Effective May 17, 2022, Pursuit, through a 60% owned subsidiary, entered into a construction loan facility for borrowings up to $17.0 million Canadian dollars (approximately $13.3 million U.S. dollars) for the development and construction of the Forest Park Hotel in Jasper National Park. Construction of the hotel was completed in August 2022. During January 2023, we completed our final borrowing under the construction loan facility bringing the total amount borrowed to approximately $16.8 million Canadian dollars.

The construction loan facility required interest only payments at Canada Prime plus 2.35% through January 31, 2023, at which time it was converted to a 6.5% fixed rate term loan. On May 16, 2023, Pursuit entered into an amendment to the Forest Park Hotel Construction Loan Facility wherein the loan was converted into a $27.0 million Canadian dollars (approximately $20.0 million U.S. dollars) credit facility (the “Jasper Credit Facility”). See below for additional details.

The Jasper Credit Facility provides for a $17.0 million Canadian dollars term loan (“Jasper Term Loan”) and a $10.0 million Canadian dollars revolving credit facility (“Jasper Revolving Credit Facility”). The Jasper Credit Facility matures on January 31, 2028.

As of June 30, 2023, the pre-compensation and post-compensation fixed-charge coverage ratio was 1.94 to 1.00, and Pursuit was in compliance with all covenants under the Jasper Credit Facility.

The proceeds of the Jasper Term Loan reflect the outstanding balance of the Forest Park Construction Loan Facility at the time it was converted to the Jasper Term Loan of $16.8 million Canadian dollars. The Jasper Term Loan bears interest at a 6.5% fixed rate.

The proceeds of the Jasper Revolving Credit Facility will be used to fund capital improvements. As of June 30, 2023, capacity remaining under the Jasper Revolving Credit Facility was $6.0 million Canadian dollars. The Jasper Revolving Credit Facility bears interest at the Canadian Prime Rate plus 2.25%.

Effective February 15, 2019, FlyOver Iceland ehf., (“FlyOver Iceland”) a wholly-owned subsidiary of Esja, entered into a credit agreement with a €5.0 million (approximately $5.6 million U.S. dollars) credit facility (the “FlyOver Iceland Credit Facility”) with an original maturity date of March 1, 2022. The loan proceeds were used to complete the development of the FlyOver Iceland attraction. The loan bears interest at the three month Euro Interbank Offered Rate plus 4.9%.

FlyOver Iceland entered into an addendum effective December 1, 2021 wherein the principal payments were deferred for twelve months beginning December 1, 2021, with the first payment due December 1, 2022. The addendum extended the maturity date to March 1, 2025, which was further extended to September 1, 2027 by way of an option as permitted in the addendum, and provided for a semi-annual waiver of certain covenants through June 30, 2022 with the first testing date as of December 31, 2022. Conditions to the addendum included securing additional capital of ISK 75.0 million (approximately $0.6 million) in January 2022, which was completed, in order to strengthen FlyOver Iceland’s liquidity position. There were no other changes to the terms of the FlyOver Iceland Credit Facility. Effective November 2, 2022, FlyOver Iceland received a financial covenant waiver for the 2022 through 2023 testing periods.

During 2020, FlyOver Iceland entered into three term loans totaling ISK 90.0 million (approximately $0.7 million U.S. dollars) (the “FlyOver Iceland Term Loans”). The first term loan for ISK 10.0 million was entered into effective October 15, 2020 and matured on April 1, 2023. It bore interest on a seven-day term deposit rate at the Central Bank of Iceland. The second term loan for ISK 30.0 million was entered into effective October 15, 2020 with a maturity date of October 1, 2024 and bears interest on a seven-day term deposit at the Central Bank of Iceland plus 3.07%. The third term loan for ISK 50.0 million was entered into effective December 29, 2020 with an original maturity date of February 1, 2023 and bears interest at one-month Reykjavik InterBank Offered Rate (“REIBOR”) plus 4.99%. Effective November 23, 2022, FlyOver Iceland entered into an amendment to the ISK 50.0 million term loan wherein the maturity date was extended to February 1, 2024. The Icelandic State Treasury guarantees supplemental loans provided by credit institutions to companies impacted by the COVID-19 pandemic. Accordingly, the Icelandic State Treasury guaranteed the repayment of up to 85% of the principal and interest on the ISK 10.0 million and ~~$3.7~~ISK 30.0 million term loans and 70% of the principal amount on the ISK 50.0 million term loan. Loan proceeds were used to fund FlyOver Iceland operations.

We entered into insurance premium financing arrangements with two financial intermediaries in order to finance certain of our insurance premium payments. The financing arrangements are payable within the next 12 months and bear a weighted average interest rate of 5.8%. The aggregate amount of premiums financed was $9.5 million with a remaining principal balance of $0.2 million as of June 30, 2023.

The carrying values of cash and cash equivalents, accounts receivables, and accounts payable approximate fair value due to the short-term ~~maturities~~nature of these instruments. Refer to Note 11 12 – Debt and ~~Capital Lease~~Finance Obligations for the estimated fair value of debt obligations.

~~The following table presents information about reclassification adjustments out~~Amounts reclassified from AOCI that relate to our defined benefit pension and postretirement plans include the amortization of ~~AOCI:~~

~~The~~prior service costs and actuarial net losses recognized during each period presented. We recorded these costs as components of ~~basic~~net periodic cost for each period presented. Refer to Note 19 – Pension and ~~diluted income per share are as follows:~~Postretirement Benefits for additional information.

Note ~~19.~~ 24. Segment Information

~~Viad measures~~An operating segment is defined as a component of an enterprise that engages in business activities for which discrete financial information is available and regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. Our CODM is our Chief Executive Officer.

We measure the profit and performance of ~~its~~our operations on the basis of segment operating income (loss) which excludes restructuring charges, ~~and recoveries and~~ impairment charges, and ~~recoveries.~~certain other corporate expenses that are not allocated to the reportable segments. Intersegment sales are eliminated in consolidation and intersegment transfers are not significant. Corporate activities include expenses not allocated to operations. ~~Depreciation and amortization and share-based compensation expense are the only significant non-cash items for the reportable segments.~~

~~Viad’s~~Our reportable segments, with reconciliations to consolidated totals, are as follows:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2023			2022			2023			2022
Revenue:
Pursuit	$	88,474		$	77,599		$	121,137		$	101,383
GES:
Spiro		80,368			89,425			140,730			132,241
GES Exhibitions		154,534			154,600			324,031			266,431
GES intersegment eliminations		(3,065	)		(2,421	)		(4,796	)		(3,492	)
Total GES		231,837			241,604			459,965			395,180
Total revenue	$	320,311		$	319,203		$	581,102		$	496,563

Segment operating income (loss):
Pursuit	$	9,811		$	5,571		$	(9,301	)	$	(15,627	)
GES:
Spiro		8,279			14,847			11,453			14,608
GES Exhibitions		15,354			16,273			25,764			14,918
Total GES		23,633			31,120			37,217			29,526
Segment operating income		33,444			36,691			27,916			13,899
Corporate eliminations (1)		16			17			32			34
Corporate activities		(3,511	)		(3,440	)		(6,676	)		(6,113	)
ON Services sale purchase price adjustment		(204	)		—			(204	)		—
Interest expense, net		(12,356	)		(7,761	)		(24,605	)		(13,638	)
Other expense, net		(448	)		(612	)		(979	)		(1,250	)
Restructuring charges:
Pursuit		(2	)		—			(9	)		—
Spiro		(39	)		(808	)		(176	)		(1,226	)
GES Exhibitions		(151	)		(588	)		(460	)		(824	)
Corporate		—			(30	)		—			(30	)
Impairment charges:
GES Exhibitions		—			—			—			(583	)
Income (loss) from continuing operations before income taxes	$	16,749		$	23,469		$	(5,161	)	$	(9,731	)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

2017

2016

Revenue:

GES:

U.S.

$
184,761

$
232,484

$
684,003

$
636,299

International

54,040

60,926

203,222

187,689

Intersegment eliminations

(6,682
)

(6,425
)

(17,126
)

(15,439
)
Total GES

232,119

286,985

870,099

808,549

Pursuit

106,980

97,402

159,581

143,111

Corporate eliminations ⁽¹⁾

—

(1,922
)

—

(3,086
)
Total revenue

$
339,099

$
382,465

$
1,029,680

$
948,574

Segment operating income (loss):

GES:

U.S.

$
(2,851
)

$
14,543

$
39,319

$
37,907

International

(2,870
)

644

8,491

4,951

Total GES

(5,721
)

15,187

47,810

42,858

Pursuit

53,860

44,248

53,523

44,733

Segment operating income

48,139

59,435

101,333

87,591

Corporate eliminations ⁽¹⁾

18

(518
)

50

(940
)
Corporate activities

(4,474
)

(2,772
)

(10,092
)

(7,390
)
Operating income

43,683

56,145

91,291

79,261

Interest income

74

44

174

138

Interest expense

(2,117
)

(1,489
)

(6,281
)

(4,109
)
Restructuring charges:

GES U.S.

435

(1,498
)

364

(1,791
)
GES International

(689
)

(203
)

(1,043
)

(1,374
)
Pursuit

—

—

—

(93
)
Corporate

(1
)

4

(138
)

(406
)
Impairment recoveries (charges):

Pursuit

24,467

(120
)

29,098

(120
)
Income from continuing operations before income taxes

$
65,852

$
52,883

$
113,465

$
71,506

(1)

Corporate eliminations represent the elimination of depreciation expense recorded by Pursuit associated with previously eliminated intercompany profit realized by GES for renovations to Pursuit’s Banff Gondola.

⁽¹⁾

Corporate eliminations recorded during the three and nine months ended September 30, 2017 represent the elimination of depreciation expense recorded by Pursuit associated with previously eliminated intercompany profit realized by GES for renovations to Pursuit’s Banff Gondola. The corporate eliminations recorded during the three and nine months ended September 30, 2016 represent the elimination of intercompany revenue and profit realized by GES for work completed on renovations to Pursuit’s Banff Gondola.

Additional information of our reportable segments is as follows:


	Three Months Ended				Six Months Ended June 30,
	June 30,				June 30,
(in thousands)	2023		2022		2023		2022
Depreciation:
Pursuit	$	8,279	$	7,866	$	16,413	$	15,648
Spiro		600		852		1,100		1,781
GES Exhibitions		1,640		2,070		3,318		4,361
Corporate		19		14		39		18
	$	10,538	$	10,802	$	20,870	$	21,808
Amortization:
Pursuit	$	1,294	$	1,316	$	2,455	$	2,495
Spiro		62		51		125		103
GES Exhibitions		910		1,038		1,829		2,080
	$	2,266	$	2,405	$	4,409	$	4,678
Capital expenditures:
Pursuit	$	17,588	$	17,219	$	25,315	$	28,710
Spiro		618		442		1,265		586
GES Exhibitions		2,590		1,383		5,598		2,248
Corporate and other		13		25		15		95
	$	20,809	$	19,069	$	32,193	$	31,639

We do not report total assets by segment because this is not a metric used to allocate resources or evaluate segment performance by our CODM.

Discontinued operations in 2017 includes reserves to resolve certain environmental matters and legal fees related to previously sold operations. During 2016, Viad recorded liability reserve adjustments and legal fees related to previously sold operations.

On November 3, 2017, the Company acquired the controlling interest (54.5% of the common stock) in Esja Attractions ehf. (“Esja”), for a purchase price of €8.2 million (approximately $9.5 million) in cash. Esja, a private corporation in Reykjavik, Iceland, is developing and will operate the new FlyOver Iceland attraction. The FlyOver Iceland attraction is expected to open in 2019.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

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:

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 2022 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 ~~the Annual Report on~~our 2022 Form 10-K ~~of Viad Corp (“Viad” or the “Company”) for the year ended December 31, 2016~~ and the condensed consolidated financial statements and ~~accompanying~~related notes included in this Form 10-Q. The MD&A is intended to assist in ~~providing an~~ understanding ~~of the Company’s~~our financial condition and results of operations. ~~This discussion contains forward-looking statements that involve risks~~

We are a leading global provider of extraordinary experiences, including hospitality and ~~uncertainties. Viad’s actual results could differ materially from those anticipated due to various factors discussed under “Forward-Looking Statements”~~leisure activities, experiential marketing, and ~~elsewhere in this Form 10-Q.~~

~~Viad operates~~live events. We operate through three reportable ~~business~~ segments: Pursuit, Spiro, and GES ~~U.S.,~~Exhibitions. Spiro and GES ~~International (collectively, “GES”), and Pursuit.~~

~~GES is a global, full-service provider for live events that produces exhibitions, conferences, corporate events, and consumer events. GES offers a comprehensive range of~~Exhibitions are both live event ~~services~~businesses, and ~~a full suite of audio-visual services from creative~~are collectively referred to as “GES.”

International tourism and ~~technology~~live event activity continues to ~~content~~improve and ~~design, along with online tools powered by next generation technologies that help clients easily manage the complexities of their events.~~

GES’ clients include event organizers and corporate brand marketers. Corporate brand marketers include exhibitors and domestic and international corporations that want to promote their brands, services and innovations, feature newdemand for our products and ~~build~~services remains strong despite ongoing macroeconomic volatility. During the first half of 2023, we operated with little to no COVID-19 related disruptions, and supply chain and labor challenges continued to improve. Changes in macroeconomic facts and circumstances, particularly high inflation and the resulting rise in interest rates, have increased our interest expense. Any future impacts from these and other macroeconomic developments on our operations cannot be predicted with certainty, but could have adverse effects on our business, ~~relationships. GES serves corporate brand marketers when they exhibit at shows~~financial condition, and ~~when GES is engaged to manage their global exhibit program or produce their proprietary corporate events.~~results of operations.

~~GES U.S.~~Pursuit’s peak activity occurs during the summer months. During 2022, 81% of Pursuit’s revenue was earned in the second and ~~GES International both offer a full suite of services for event organizers and corporate brand marketers across four~~third quarters.

GES’ live ~~event markets: (i) Exhibitions; (ii) Conferences; (iii) Corporate Events, and (iv) Consumer Events (collectively, “Live Events”).~~

~~GES offers a comprehensive range of services and innovative technology to event organizers and corporate brand marketers including (i) Core Services; (ii) Event Technology, and (iii) Audio-Visual:~~

~~GES U.S. and GES International exhibition and~~ event activity can vary significantly from quarter to quarter and year to year depending on the frequency and timing of ~~shows, as some~~shows. Some shows are not held ~~each year~~annually and some ~~may~~ shift between quarters. Show rotation refers to shows that occur less frequently than annually, as well as annual shows that shift quarters from one year to the next.

Pursuit is a collection of iconic natural and cultural destination travel experiences that enjoy perennial demand. Pursuit offers guests distinctive and world renowned experiences through its collection of unique hotels, lodges, recreational attractions, and transportation services. Pursuit is composed(1)

Six months ended ~~September~~June 30, ~~2017~~2023 compared with the ~~nine~~six months ended ~~September~~June 30, ~~2016~~2022

•

Segment operating income increased $14.0 million during the ~~strengthening of the Canadian dollar relative to the U.S. dollar. Viad’s nine~~six months ended ~~September~~June 30, ~~2017~~2023, primarily due to higher revenue at GES and segment operating results were primarily impacted by the weakening of the British pound and the strengthening of the Canadian dollar relative to the U.S. dollar. Future changes in the exchange rates may impact overall expected profitability and historical period-to-period comparisons when revenue and segment operating results are translated into U.S. dollars.

Pursuit.

Analysis of Revenue and Operating Results by Reportable Segment

~~GES~~Pursuit

The following ~~tables provide a comparison of GES’ reported revenue and segment operating results to organic revenue~~⁽³⁾ ~~and organic segment operating results~~⁽³⁾ ~~for the three and nine months ended September 30, 2017 and 2016 in order to better understand the underlying performance of the segment without the effects of acquisitions or FX Impact.~~

Three Months Ended

Three Months Ended

September 30, 2017

September 30, 2016

Change

(in thousands)

As Reported

Acquisitions⁽¹⁾

FX Impact

Organic⁽³⁾

As Reported

Acquisitions⁽²⁾

Organic⁽³⁾

As Reported

Organic⁽³⁾

Revenue:

GES:

U.S.

$
184,761

$
19,063

$
—

$
165,698

$
232,484

$
10,354

$
222,130

(20.5
)%

(25.4
)%
International

54,040

152

1,297

52,591

60,926

—

60,926

(11.3
)%

(13.7
)%
Intersegment eliminations

(6,682
)

—

—

(6,682
)

(6,425
)

—

(6,425
)

(4.0
)%

(4.0
)%
Total GES

$
232,119

$
19,215

$
1,297

$
211,607

$
286,985

$
10,354

$
276,631

(19.1
)%

(23.5
)%
Segment operating income (loss) ⁽⁴⁾:

GES:

U.S.

$
(2,851
)

$
(1,080
)

$
—

$
(1,771
)

$
14,543

$
458

$
14,085

**

**

International

(2,870
)

(269
)

172

(2,773
)

644

—

644

**

**

Total GES

$
(5,721
)

$
(1,349
)

$
172

$
(4,544
)

$
15,187

$
458

$
14,729

**

**

Nine Months Ended

Nine Months Ended

September 30, 2017

September 30, 2016

Change

(in thousands)

As Reported

Acquisitions⁽¹⁾

FX Impact

Organic⁽³⁾

As Reported

Acquisitions⁽²⁾

Organic⁽³⁾

As Reported

Organic⁽³⁾

Revenue:

GES:

U.S.

$
684,003

$
56,544

$
—

$
627,459

$
636,299

$
15,398

$
620,901

7.5
%

1.1
%
International

203,222

738

(11,697
)

214,181

187,689

—

187,689

8.3
%

14.1
%
Intersegment eliminations

(17,126
)

—

—

(17,126
)

(15,439
)

—

(15,439
)

(10.9
)%

(10.9
)%
Total GES

$
870,099

$
57,282

$
(11,697
)

$
824,514

$
808,549

$
15,398

$
793,151

7.6
%

4.0
%
Segment operating income (loss)⁽⁴⁾:

GES:

U.S.

$
39,319

$
(913
)

$
—

$
40,232

$
37,907

$
543

$
37,364

3.7
%

7.7
%
International

8,491

(463
)

(470
)

9,424

4,951

—

4,951

71.5
%

90.3
%
Total GES

$
47,810

$
(1,376
)

$
(470
)

$
49,656

$
42,858

$
543

$
42,315

11.6
%

17.3
%

** Change is greater than +/- 100 percent

⁽¹⁾	~~Acquisitions include ON Services (acquired August 2016) for GES U.S. and Poken (acquired March 2017) for GES International and GES U.S.~~

⁽²⁾	To maximize synergies, GES’ existing in-house audio-visual services team was merged into ON Services. Accordingly, the amounts for GES U.S. acquisitions include results from the existing in-house audio-visual services team.

⁽³⁾

Organic revenue and organic segment operating results are non-GAAP financial measures that adjust for the impacts of exchange rate variances and acquisitions, if any, until such acquisitions are included in the entirety of both comparable periods presented. For more information about organic revenue and organic segment operating results, see the “Non-GAAP Measures” section of this MD&A.

⁽⁴⁾	~~Refer to Note 19~~ – Segment Information of the Notes to Condensed Consolidated Financial Statements for a reconciliation of the non-GAAP financial measure, segment operating income (loss), to the most directly comparable GAAP measure.

~~Three months ended September 30, 2017 compared with the three months ended September 30, 2016~~

~~GES U.S.~~

~~GES U.S. revenue~~ decreased $47.7 million or 20.5 percent, primarily due to negative show rotation of approximately $63 million and other non-recurring business in the comparable prior period, offset in part by incremental revenue of $8.7 million from the acquisitions of ON Services and Poken, new business wins, and U.S. base same-show revenue growth of 1.6 percent. U.S. base same-show revenue growth was lower due to one event with a reduced scope of service as result of a venue change. Base same-shows represented 37.0 percent of GES’ U.S. organic revenue*. Organic revenue* decreased $56.4 million or 25.4 percent.

~~GES U.S. operating results~~ decreased $17.4 million to an operating loss of $2.9 million. This decrease was primarily due to the decrease in revenue driven by negative show rotation, offset in part by lower performance-based compensation expense and income of $2.8 million from a contract settlement. Organic operating income* decreased $15.9 million.

~~GES International~~

~~GES International revenue~~ decreased $6.9 million or 11.3 percent, primarily due to negative show rotation of approximately $12 million, offset in part by new business wins and a favorable FX Impact of $1.3 million. Organic revenue* decreased $8.3 million or 13.7 percent.

~~GES International operating results~~ decreased $3.5 million to an operating loss of $2.9 million. This decrease was primarily due to the decrease in revenue driven by negative show rotation. Organic operating income* decreased $3.4 million.

~~Nine months ended September 30, 2017 compared with the nine months ended September 30, 2016~~

~~GES U.S.~~

~~GES U.S. revenue~~ increased $47.7 million or 7.5 percent, primarily due to incremental revenue of $41.1 million from the acquisitions of ON Services and Poken and U.S. base same-show revenue growth of 4.4 percent, offset in part by negative show rotation of approximately $7 million. Base same-shows represented 35.4 percent of GES’ U.S. organic revenue*. Organic revenue* increased $6.6 million or 1.1 percent.

~~GES U.S. operating income~~ increased $1.4 million or 3.7 percent, primarily due to higher revenue, offset in part by a $7.5 million increase in depreciation and amortization expense primarily due to the acquisition of ON Services. Organic operating income* increased $2.9 million or 7.7 percent.

~~GES International~~

~~GES International revenue~~ increased $15.5 million or 8.3 percent, primarily due to new business wins, offset in part by an unfavorable FX Impact of $11.7 million. GES International had positive show rotation of approximately $1.0 million. Organic revenue* increased $26.5 million or 14.1 percent.

~~GES International operating income~~ ~~increased $3.5 million or 71.5 percent, primarily due to higher revenue. Organic operating income* increased $4.5 million or 90.3 percent.~~

* Refer to footnote (3) in the above tables for more information about the non-GAAP financial measures of organic revenue and organic segment operating results.

~~2017 Outlook~~

Although GES has a diversified revenue base and long-term contracts for future shows, its revenue is affected by general economic and industry-specific conditions. The prospects for individual shows tend to be driven by the success of the industry related to those shows. In general, the exhibition and event industry is experiencing modest growth.

For the 2017 full year, management expects GES’ revenue to increase 6 percent to 7 percent versus 2016. The August 2016 acquisition of ON Services and the March 2017 acquisition of Poken are expected to provide incremental revenue of $43 million to $45 million and incremental Adjusted Segment EBITDA of $5 million to $7 million. Show rotation is expected to have a net negative impact on GES’ revenue of approximately $10 million compared to 2016. GES U.S. base same-show revenue is expected to increase at a mid-single digit rate. Management anticipates an unfavorable FX Impact on GES’ 2017 full year revenue and segment operating income of approximately $7 million and $0.2 million, respectively. The expected FX Impact reflects the assumption that the U.S. dollar to the British pound exchange rate will be $1.31 and the U.S. dollar to the Canadian dollar exchange rate will be $0.81 during the fourth quarter of 2017. For more information about Adjusted Segment EBITDA and segment operating income, see the “Non-GAAP Measures” section of this MD&A.

Management is executing a strategic growth plan to position GES as the preferred global, full-service provider for Live Events, with further reach to corporate events, consumer events, conferences, and exhibitions. In support of this strategy, the Company has acquired two leading audio-visual production businesses and four leading event technology businesses since 2014 that complement, enhance, and expand the current business and offer higher-margin growth opportunities. Management continues to pursue additional opportunities to acquire businesses with proven products and services to create the most comprehensive suite of services for the Live Events industry. During 2017, management intends to make selective investments in additional resources to capitalize on continued growth opportunities in under-penetrated categories of Live Events, such as corporate events and consumer events, and in cross-selling new services.

Additionally, management remains focused on improving the profitability of GES through continued efforts to more effectively manage labor costs by driving productivity gains through rigorous and strategic pre-show planning that reduces the ratio of labor costs to revenue. Improving this metric is a top priority of management and the Company continues to develop and enhance tools to support and systematize show site labor planning, measurement, and benchmarking.

~~Pursuit~~

~~The following tables provide~~table presents a comparison of Pursuit’s reported revenue and segment operating ~~results to organic revenue~~⁽²⁾ ~~and organic segment operating results~~⁽²⁾income (loss) for the three and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 and ~~2016 in order~~2022:


	Three Months Ended							Six Months Ended
	June 30,							June 30,
(in thousands)	2023		2022		% Change			2023			2022			% Change
Revenue(1):
Pursuit:
Attractions	$	48,026	$	39,096		22.8	%	$	67,030		$	51,597			29.9	%
Hospitality		36,436		34,101		6.8	%		47,639			43,516			9.5	%
Transportation		3,441		3,837		(10.3	)%		5,414			5,125			5.6	%
Other		571		565		1.1	%		1,054			1,145			(7.9	)%
Total Pursuit	$	88,474	$	77,599		14.0	%	$	121,137		$	101,383			19.5	%

Segment operating income (loss)(2):
Total Pursuit	$	9,811	$	5,571		76.1	%	$	(9,301	)	$	(15,627	)		40.5	%

(1)

Revenue by line of business does not agree to ~~better understand the underlying performance~~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 24 – 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 ~~without~~operating income (loss), to the ~~effects of acquisitions or FX Impact.~~

Three Months Ended

Three Months Ended

September 30, 2017

September 30, 2016

Change

(in thousands)

As Reported

Acquisitions⁽¹⁾

FX Impact

Organic⁽²⁾

As Reported

Acquisitions

Organic⁽²⁾

As Reported

Organic⁽²⁾

Revenue:

Pursuit:

Hospitality

$
39,577

$
—

$
236

$
39,341

$
39,664

$
—

$
39,664

(0.2
)%

(0.8
)%
Attractions

59,059

4,227

1,700

53,132

42,883

—

42,883

37.7
%

23.9
%
Transportation

6,252

—

201

6,051

5,097

—

5,097

22.7
%

18.7
%
Travel Planning

2,874

—

29

2,845

10,908

—

10,908

(73.7
)%

(73.9
)%
Intra-Segment Eliminations & Other

(782
)

—

(47
)

(735
)

(1,150
)

—

(1,150
)

32.0
%

36.1
%
Total Pursuit

$
106,980

$
4,227

$
2,119

$
100,634

$
97,402

$
—

$
97,402

9.8
%

3.3
%

Segment operating income ⁽³⁾:

Total Pursuit

$
53,860

$
2,227

$
1,218

$
50,415

$
44,248

$
—

$
44,248

21.7
%

13.9
%
most directly comparable GAAP measure.

Nine Months Ended

Nine Months Ended

September 30, 2017

September 30, 2016

Change

(in thousands)

As Reported

Acquisitions⁽¹⁾

FX Impact

Organic⁽²⁾

As Reported

Acquisitions⁽¹⁾

Organic⁽²⁾

As Reported

Organic⁽²⁾

Revenue:

Pursuit:

Hospitality

$
55,279

$
13,440

$
145

$
41,694

$
56,791

$
12,935

$
43,856

(2.7
)%

(4.9
)%
Attractions

88,910

21,256

910

66,744

61,056

13,597

47,459

45.6
%

40.6
%
Transportation

11,906

—

120

11,786

10,150

—

10,150

17.3
%

16.1
%
Travel Planning

4,334

1,268

9

3,057

16,861

1,529

15,332

(74.3
)%

(80.1
)%
Intra-Segment Eliminations & Other

(848
)

—

(50
)

(798
)

(1,747
)

—

(1,747
)

51.5
%

54.3
%
Total Pursuit

$
159,581

$
35,964

$
1,134

$
122,483

$
143,111

$
28,061

$
115,050

11.5
%

6.5
%

Segment operating income ⁽³⁾:

Total Pursuit

$
53,523

$
8,431

$
762

$
44,330

$
44,733

$
8,870

$
35,863

19.6
%

23.6
%

⁽¹⁾	Acquisitions for the three months ended September 30, 2017 include FlyOver Canada (acquired December 2016). Acquisitions for the nine month periods include CATC Alaska Tourism Corporation (“CATC”) (acquired March 2016) and FlyOver Canada (acquired December 2016).

⁽²⁾

⁽³⁾	~~Refer to Note 19~~ – Segment Information of the Notes to Condensed Consolidated Financial Statements for a reconciliation of the non-GAAP financial measure, segment operating income, to the most directly comparable GAAP measure.

Three months ended ~~September~~June 30, ~~2017~~2023 compared with the three months ended ~~September~~June 30, ~~2016~~2022

Pursuit revenue increased ~~$9.6~~$10.9 million ~~or 9.8 percent, due to strong growth from attractions, primarily the~~driven by stronger international visitation in Western Canada and Iceland. Visitation at Pursuit’s Golden Skybridge, Sky Lagoon, and Banff Gondola attractions increased 62%, 22% and ~~Columbia Icefield~~17%, respectively. Collectively, Pursuit’s new attractions that were opened or acquired after January 1, 2022, including the Glacier ~~Adventure attractions,~~Raft Company and Forest Park Alpine Hotel, contributed incremental revenue of $1.3 million during the three months ended June 30, 2023.

Pursuit segment operating income increased $4.2 million from the acquisition of FlyOver Canada, and a favorable FX Impact of $2.1 million. This increase was offset in part by a reduction in travel planning as the Company completes the previously announced downsizing of Brewster Travel Canada’s package tours line of business and a revenue decline of $2.1 million due to the fire-related closure of the Mount Royal Hotel. Organic revenue* increased $3.2 million or 3.3 percent.

~~Pursuit operating income~~ ~~increased $9.6 million or 21.7 percent,~~prior year period primarily due to the increase in revenue, from high-margin attractions. Operating income included a $1.1 million business interruption gain for the recovery of lost profits from the Mount Royal Hotel. Organic operating income* increased $6.2 million or 13.9 percent.

~~Nine months ended September 30, 2017 compared with the nine months ended September 30, 2016~~

~~Pursuit revenue~~ increased $16.5 million or 11.5 percent, due to strong growth from attractions primarily driven by the re-opening of the Banff Gondola (which was closed for renovations from October 2015 through April 2016), incremental revenue of $7.9 million from the acquisitions of FlyOver Canada and CATC, and a favorable FX Impact of $1.1 million. This increase was offset in part by ~~a reduction~~the increase in ~~travel planning as~~operating costs to support higher business volume during the three months ended June 30, 2023.

Six months ended June 30, 2023 compared with the six months ended June 30, 2022

Pursuit revenue increased $19.8 million driven by stronger international visitation. Visitation at Pursuit’s Golden Skybridge, Sky Lagoon and Banff Gondola attractions increased 62%, 43% and 20%, respectively. Collectively, Pursuit’s new attractions that were opened or acquired after January 1, 2022, including the Glacier Raft Company ~~completes~~and Forest Park Alpine Hotel, contributed incremental revenue of $2.1 million during the ~~previously announced downsizing of Brewster Travel Canada’s package tours line of business and a revenue decline of $4.6~~six months ended June 30, 2023.

Pursuit segment operating loss improved $6.3 million ~~due to~~from the ~~fire-related closure of the Mount Royal Hotel. Organic revenue* increased $7.4 million or 6.5 percent.~~

~~Pursuit operating income~~ ~~increased $8.8 million or 19.6 percent,~~prior year period primarily due to the increase in revenue, ~~from high-margin attractions. Operating income included a $2.2 million~~offset in part by the increase in operating costs to support higher business ~~interruption gain for~~volume during the ~~recovery of lost profits from the Mount Royal Hotel. Organic operating income* increased $8.5 million or 23.6 percent.~~six months ended June 30, 2023.

* Refer to footnote (2) in the above tables for more information about the non-GAAP financial measures of organic revenue and organic segment operating results.

Performance Measures

~~Management uses~~We use the following key business metrics to evaluate the performance of Pursuit’s ~~hospitality~~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 ~~available room (“RevPAR”), average daily rate (“ADR”), and occupancy. These~~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, ~~are commonly used~~common in the hospitality industry, to ~~measure performance.~~evaluate Pursuit’s hospitality business:

•

Revenue per Available ~~Room.~~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.~~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 ~~generate.~~realize. Increases in ADR ~~at hospitality properties~~ 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 ~~increased~~increases in ancillary non-rooms revenue (including food and beverage and retail revenue).

Management evaluates the performance of Pursuit’s attractions business utilizing the number of passengers and total attractions revenue per passenger. The number of passengers allows management to assess the volume of visitor activity at each attraction during the period. Total attractions revenue per passenger is calculated as total attractions revenue divided by the total number of passengers 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 passenger measures the total spend per visitor that attraction properties are able to capture, which is important to the profitability of the attractions business.

The following table provides Pursuit’s ~~same-store~~ key performance ~~indicators for~~indicators:


	Three Months Ended									Three Months Ended
	June 30, 2023									June 30, 2022											% Change
	As Reported			New Experiences(1)			Same-Store(2)			As Reported			New Experiences(1)			FX Impact(3)		Same-Store(2)			As Reported			Same-Store(2)
Attractions Key Performance Indicators:
Number of visitors		914,317			8,328			905,989			742,920			6,450			—		736,470			23.1	%		23.0	%
Ticket revenue (in thousands)	$	36,543		$	626		$	35,917		$	29,337		$	480		$	1,041	$	27,815			24.6	%		29.1	%
Effective ticket price	$	39.97		$	75.18		$	39.64		$	39.49		$	74.46		$	—	$	37.77			1.2	%		5.0	%
Attractions revenue (in thousands)	$	48,026		$	1,070		$	46,955		$	39,096		$	817		$	1,429	$	36,850			22.8	%		27.4	%
Revenue per attraction visitor	$	52.53		$	128.51		$	51.83		$	52.62		$	126.74		$	—	$	50.04			(0.2	)%		3.6	%
Hospitality Key Performance Indicators:
Room nights available		163,344			10,101			153,243			156,306			1,403			—		154,903			4.5	%		(1.1	)%
Rooms revenue (in thousands)	$	22,106		$	1,394		$	20,712		$	20,559		$	317		$	523	$	19,719			7.5	%		5.0	%
RevPAR	$	135.33		$	138.05		$	135.16		$	131.53		$	225.94		$	—	$	127.30			2.9	%		6.2	%
Occupancy		68.0	%		60.4	%		68.5	%		67.9	%		61.6	%		—		68.0	%		0.1	%		0.7	%
ADR	$	199.13		$	228.41		$	197.42		$	193.70		$	366.89		$	—	$	187.36			2.8	%		5.4	%
Hospitality revenue (in thousands)	$	36,436		$	1,516		$	34,920		$	34,101		$	429		$	669	$	33,003			6.8	%		5.8	%


	Six Months Ended									Six Months Ended
	June 30, 2023									June 30, 2022											% Change
	As Reported			New Experiences(1)			Same-Store(2)			As Reported			New Experiences(1)			FX Impact(3)		Same-Store(2)			As Reported			Same-Store(2)
Attractions Key Performance Indicators:
Number of visitors		1,323,453			8,328			1,315,125			1,034,498			6,450			—		1,028,048			27.9	%		27.9	%
Ticket revenue (in thousands)	$	50,804		$	626		$	50,178		$	38,539		$	480		$	1,674	$	36,385			31.8	%		37.9	%
Effective ticket price	$	38.39		$	75.18		$	38.15		$	37.25		$	74.46		$	—	$	35.39			3.0	%		7.8	%
Attractions revenue (in thousands)	$	67,030		$	1,203		$	65,827		$	51,597		$	817		$	2,308	$	48,473			29.9	%		35.8	%
Revenue per attraction visitor	$	50.65		$	144.49		$	50.05		$	49.88		$	126.74		$	—	$	47.15			1.5	%		6.2	%
Hospitality Key Performance Indicators:
Room nights available		278,765			18,980			259,785			268,242			1,403			—		266,839			3.9	%		(2.6	)%
Rooms revenue (in thousands)	$	29,696		$	1,968		$	27,728		$	27,462		$	317		$	916	$	26,228			8.1	%		5.7	%
RevPAR	$	106.53		$	103.69		$	106.73		$	102.38		$	225.94		$	—	$	98.29			4.1	%		8.6	%
Occupancy		64.5	%		57.2	%		65.0	%		61.9	%		61.6	%		—		62.0	%		4.1	%		4.9	%
ADR	$	165.24		$	181.34		$	164.21		$	165.28		$	366.89		$	—	$	158.66			0.0	%		3.5	%
Hospitality revenue (in thousands)	$	47,639		$	2,096		$	45,543		$	43,516		$	429		$	1,179	$	41,908			9.5	%		8.7	%

(1)

New experiences comprise the ~~three and nine months ended September 30, 2017 and 2016. The same-store metrics below indicate the performance of all Pursuit properties and~~following attractions that were ~~owned by Viad~~opened or acquired after January 1, 2022: the Glacier Raft Company (acquired April 2022) and ~~operating~~Forest Park Alpine Hotel (opened August 2022).

(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 ~~Pursuit properties and attractions~~experiences located ~~in Canada,~~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 ~~FX Impact. Management believes that this same-store constant currency basis provides better comparability between reporting periods.~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

2017

2016

% Change

2017

2016

% Change

Same-Store Key Performance Indicators ⁽¹⁾

Hospitality:

Room nights available

108,015

107,635

0.4
%

152,366

150,604

1.2
%
RevPAR

$
200

$
192

4.2
%

$
140

$
133

5.3
%
ADR

$
227

$
213

6.6
%

$
187

$
178

5.1
%
Occupancy

87.9
%

90.1
%

(2.2
)%

75.2
%

74.8
%

0.4
%
Attractions:

Passengers

1,139,516

1,092,356

4.3
%

1,626,121

1,453,899

11.8
%
Revenue per passenger

$
48

$
40

20.0
%

$
42

$
33

27.3
%

⁽¹⁾

~~The Same-Store Key Performance Indicators for the three month comparison exclude the FlyOver Canada attraction (acquired in December 2016) as it was not owned by Viad for the entirety~~impact of both periods presented. The Same-Store Key Performance Indicators for the nine month comparison exclude the CATC hospitality properties and attraction (acquired in March 2016) and the FlyOver Canada attraction (acquired in December 2016), as they were not owned by Viad for the entirety of both periods presented. Additionally, the Same-Store Key Performance Indicators exclude the Mount Royal Hotel hospitality property due to its fire-related closure (effective December 2016). The Banff Gondola attraction was closed for renovations from October 2015 through April 2016. Accordingly, 2016 includes only five months of operation whereas 2017 includes the full three and nine months of operations.

~~Hospitality.~~ ~~Room nights available increased during the nine months ended September 30, 2017 primarily due to~~ changes in exchange rates for same-store Pursuit experiences located outside of the ~~opening dates for certain seasonal properties. RevPAR~~United States.

Attractions. Attractions ticket revenue on a same-store basis increased $8.1 million on a 23.0% increase in visitors during the three months ended ~~September~~June 30, ~~2017 primarily due to an~~2023 and increased $13.8 million on a 27.9% increase in ~~ADR driven by management’s focus on yield management, offset in part by lower occupancy primarily due to forest fires in the Glacier National Park area. RevPAR increased~~visitors during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023, driven primarily ~~due to an increase in occupancy~~by higher international visitation and ~~an increase in ADR driven by management’s focus on yield management, as well as an increase in occupancy reflecting strong park visitation during the first nine months of 2017.~~higher effective ticket prices.

~~Attractions~~Hospitality. The increase in ~~the number of passengers~~RevPAR on a same-store basis during the three months ended ~~September~~June 30, ~~2017~~2023 was primarily due to ~~management’s efforts to enhance the guest experience and its focus on yield~~higher ADR driven by revenue management ~~combined with strong park visitation in Canada.~~efforts. The increase in ~~the number of passengers~~RevPAR on a same-store basis during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2023 was primarily due to the Banff Gondola being closed for renovations during the first four months of 2016. Excluding the Banff Gondola passengers, total same-store attraction passengers for the nine month period would have increased 36,158 in 2017 driven by ~~management’s efforts to enhance the guest experience and its focus on yield management, combined with strong park visitation in Canada.~~

~~Revenue per passenger increased during 2017 primarily due to~~ higher ~~effective ticket prices driven by management’s focus on yield management,~~occupancy and higher ~~revenue from ancillary food and beverage and retail services primarily resulting from management’s recent renovations~~ADR.

GES

The following table presents a comparison of ~~the retail and food and beverage operations at the Banff Gondola and the food and beverage operations at the Columbia Icefield Glacier Discovery Center.~~

During 2016, Pursuit derived approximately 59 percent of its revenue and 74 percent of its segment operating income from its Canadian operations, which are largely dependent on foreign customer visitation. Accordingly, the strengthening or weakening of the Canadian dollar, relative to other currencies, could affect customer volumes and the results of operations. Additionally, Pursuit is affected by consumer discretionary spending on tourism activities.

~~2017 Outlook~~

For the 2017 full year, management expects Pursuit’s revenue to increase 12 percent to 14 percent. The December 2016 acquisition of FlyOver Canada and the March 2016 acquisition of CATC, combined, are expected to provide incremental revenue of $10 million to $11 million and incremental Adjusted Segment EBITDA of $2 million to $3.5 million, which includes an incremental first quarter seasonal operating loss of approximately $2.3 million from CATC.

Additionally, management expects Pursuit’s revenue to be negatively impacted by approximately $13 million as the Company completes the previously announced downsizing of Brewster Travel Canada’s package tours line of business. The fire-related closure of the Mount Royal Hotel is expected to negatively impact revenue by approximately $5 million. Management anticipates a favorable FX Impact on Pursuit’s 2017 full yearGES’ reported revenue and segment operating income during the three and six months ended June 30, 2023 and 2022:


	Three Months Ended									Six Months Ended
	June 30,									June 30,
(in thousands)	2023			2022			% Change			2023			2022			% Change
Revenue:
GES:
Spiro	$	80,368		$	89,425			(10.1	)%	$	140,730		$	132,241			6.4	%
GES Exhibitions		154,534			154,600			—			324,031			266,431			21.6	%
Intersegment eliminations		(3,065	)		(2,421	)		(26.6	)%		(4,796	)		(3,492	)		(37.3	)%
Total GES	$	231,837		$	241,604			(4.0	)%	$	459,965		$	395,180			16.4	%
Segment operating income(1):
GES:
Spiro	$	8,279		$	14,847			(44.2	)%	$	11,453		$	14,608			(21.6	)%
GES Exhibitions		15,354			16,273			(5.6	)%		25,764			14,918			72.7	%
Total GES	$	23,633		$	31,120			(24.1	)%	$	37,217		$	29,526			26.0	%

(1)

Refer to Note 24 – 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, to the most directly comparable GAAP measure.

Three months ended June 30, 2023 compared with the three months ended June 30, 2022

Spiro revenue decreased $9.1 million primarily due to the sale of substantially all of the assets of ON Services in December of 2022, which contributed revenue of $9.2 million during the three months ended June 30, 2022, and shifts in timing of client spend, offset in part by positive show rotation from major non-annual shows of approximately $13 million, which represent shows greater than $1.0 million, and new client wins.

GES Exhibitions revenue remained relatively flat primarily due to same-show revenue growth of approximately 18.9%, offset in part by shifts in timing of events driven by pandemic-related disruptions in 2022 that resulted in shows that were postponed from the 2022 first quarter and into the 2022 second quarter that returned to their normal first quarter schedules in 2023 that impacted revenue of approximately $10.0 million, the sale of substantially all of the assets of ON Services in December of 2022, which contributed revenue of $6.4 million during the three months ended June 30, 2022, and negative show rotation from major non-annual shows of approximately $3 million.

Spiro segment operating income decreased $6.6 million primarily due to decreased revenue and the restaffing of the workforce from pandemic levels.

GES Exhibitions segment operating income decreased $0.9 million primarily due to the restaffing of the workforce from pandemic levels.

Six months ended June 30, 2023 compared with the six months ended June 30, 2022

Spiro revenue increased $8.5 million primarily due to positive show rotation from major non-annual shows of approximately $16 million and new client wins, offset in part by the sale of substantially all of the assets of ON Services in December of 2022, which contributed revenue of $14.2 million during the six months ended June 30, 2022, and shifts in timing of client spend.

GES Exhibitions revenue increased $57.6 million, primarily due to same-show revenue growth of approximately 23.8% and positive show rotation of approximately $2 million, ~~and $0.7~~offset in part by the sale of substantially all of the assets of ON Services in December of 2022, which contributed revenue of $9.8 million ~~respectively. Management expects these factors will be more than offset by organic growth across the rest of Pursuit’s lines of business.~~

~~In July 2017, Viad resolved its property and business interruption insurance claims related to the Mount Royal Hotel fire for a total of $36.3 million, inclusive of $9.0 million received~~ during the first and second quarters of 2017. Viad recorded an additional impairment recovery of approximately $24.7 million related to construction costs to re-open the hotel, $1.1 million was recorded as a business interruption gain for the recovery of lost profits, and the remaining $1.5 million was recorded as deferred income that will be recognized over the periods the business interruption losses are actually incurred. Management anticipates recognizing approximately $0.5 million of the business interruption recovery during the remainder of 2017 with approximately $1 million being deferred to the first half of 2018.six months ended June 30, 2022.

The Pursuit guidance ranges include approximately $1 million in revenue and approximately $3 million in adjusted segment EBITDA related to the Mount Royal Hotel, which reflects the 2017 portion of business interruption insurance recoveries (including both business interruption gains for lost profits and contra-expense for on-going operating costs) and the re-opening of most of the property’s retail tenants and one of its dining operations. The hotel itself is expected to remain closed until mid-2018. For more information about Adjusted Segment EBITDA andSpiro segment operating income ~~see the “Non-GAAP Measures” section of this MD&A.~~

~~Corporate Activities~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

Percentage Change 2017 vs. 2016

2017

2016

Percentage Change 2017 vs. 2016

Corporate activities

$
4,474

$
2,772

61.4
%

$
10,092

$
7,390

36.6
%

~~The increase in corporate activities expense for the three and nine months ended September 30, 2017 was~~decreased $3.2 million primarily due to ~~an increase~~the restaffing of the workforce from pandemic levels, offset in ~~performance-based compensation expense driven~~part by ~~Viad’s common stock price appreciation.~~higher revenue.

~~Interest Expense~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

Percentage Change 2017 vs. 2016

2017

2016

Percentage Change 2017 vs. 2016

Interest expense

$
2,117

$
1,489

42.2
%

$
6,281

$
4,109

52.9
%

~~The increase in interest expense for the three and nine months ended September 30, 2017 was~~GES Exhibitions segment operating income increased $10.8 million, primarily due to ~~higher debt balances~~the increase in ~~2017 resulting~~revenue, offset in part by the restaffing of the workforce from ~~acquisitions completed during August and December of 2016.~~pandemic levels.

~~Restructuring Charges~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

Percentage Change 2017 vs. 2016

2017

2016

Percentage Change 2017 vs. 2016

Restructuring charges

$
255

$
1,697

(85.0
)%

$
817

$
3,664

(77.7
)%

~~Restructuring charges during the three and nine months ended September 30, 2017 and 2016 were primarily related to the elimination of certain positions and facility consolidations in GES.~~Other Expenses

~~Impairment Charges (Recoveries)~~


	Three Months Ended						Nine Months Ended						Three Months Ended								Six Months Ended
	September 30,						September 30,						June 30,								June 30,
(in thousands)	2017			2016		Percentage Change 2017 vs. 2016	2017			2016		Percentage Change 2017 vs. 2016	2023			2022		% Change			2023			2022		% Change
Impairment charges (recoveries)	$	(24,467	)	$	120	**	$	(29,098	)	$	120	**
Corporate activities													$	3,511		$	3,440		2.1	%	$	6,676		$	6,113		9.2	%
ON Services sale purchase price adjustment													$	204		$	—	**			$	204		$	—	**
Interest expense, net													$	12,356		$	7,761		59.2	%	$	24,605		$	13,638		80.4	%
Other expense, net													$	448		$	612		(26.8	)%	$	979		$	1,250		(21.7	)%
Restructuring charges													$	192		$	1,426		(86.5	)%	$	645		$	2,080		(69.0	)%
Impairment charges													$	—		$	—	**			$	—		$	583		(100.0	)%
Income tax expense													$	5,028		$	3,359		49.7	%	$	4,450		$	777	**
Income (loss) from discontinued operations													$	(143	)	$	52	**			$	(201	)	$	327	**

** Change is greater than +/- ~~100 percent~~100%

~~On December 29, 2016,~~Interest Expense, net – The increase in interest expense during the ~~Mount Royal Hotel~~three and six months ended June 30, 2023 was ~~damaged by~~primarily due to higher interest rates in 2023, and to a ~~fire~~lesser extent to a $1.9 million reduction in capitalized interest recorded during the six months ended June 30, 2023 as compared to the six months ended June 30, 2022.

Restructuring Charges – The decrease in restructuring changes during the three and ~~closed. During July 2017, the Company resolved its property and business interruption insurance claims~~six months ended June 30, 2023 was primarily related to ~~the fire for~~our 2022 transformation and streamlining efforts at GES to significantly reduce costs and create a total of $36.3 million. During the three months ended September 30, 2017, the Company received insurance proceeds of $27.3 million, of which $24.7 million was recorded as an impairment recovery (partially offset by impairment charges of $0.2 million) related to construction costs to re-open the hotel, $1.1 million was recorded as a business interruption gain for the recovery of lost profits,lower and the remaining $1.5 million was recorded as deferred income, which will be recognized over the periods the business interruption losses are actually incurred. During the nine months ended September 30, 2017, the Company received $36.3 million in insurance proceeds, of which $2.2 million was allocated to an insurance receivable, $29.3 million was recorded as an impairment recovery (partially offset by impairment charges of $0.2 million) related to construction costs to re-open the hotel, $2.2 million was recorded as a business interruption gain for the recovery of lost profits, $1.1 million was recorded as contra-expense to offset non-capitalizable costs incurred by the Company, and the remaining $1.5 million was recorded as deferred income, which will be recognized over the periods the business interruption losses are actually incurred.more flexible cost structure focused on servicing our more profitable market segments.

Income ~~Taxes~~

Tax Expense – The effective tax ~~rates~~rate was 30.0% for the three months ended ~~September~~June 30, ~~2017~~2023 and ~~2016 were 30.4 percent and 33.8 percent, respectively. The effective tax rates for the nine months ended September 30, 2017 and 2016 were 29.0 percent and 33.1 percent, respectively. The decrease~~14.3% for the three months ended June 30, 2022. The effective tax rate was ~~primarily due to higher foreign income taxed at lower rates. The decrease~~a negative 86.2% for the ~~nine~~six months ~~was primarily due to higher foreign income taxed at lower rates,~~ended June 30, 2023 and a negative 8.0% for six months ended June 30, 2022. The effective tax rate differed from the ~~release~~21% federal rate for the three months ended June 30, 2023 and June 30, 2022 as a result of excluding the tax benefit on jurisdictions where we have a valuation allowance ~~related to foreign net operating losses,~~ and the ~~adoption~~change in income or loss in our jurisdictions. The effective tax rate differed from the federal rate for the six months ended June 30, 2023 and June 30, 2022 also as a result of ~~new accounting guidance, effective~~excluding tax benefits in certain jurisdictions, the mix of income or loss by jurisdiction, and the $2.1 million benefit taken in the first quarter of ~~2017, which requires the excess tax benefit~~2023 on ~~share-based compensation to be recorded to income tax expense rather than equity.~~

~~Discontinued Operations~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

Percentage Change 2017 vs. 2016

2017

2016

Percentage Change 2017 vs. 2016

Loss from discontinued operations

$
(101
)

$
(221
)

54.3
%

$
(408
)

$
(771
)

47.1
%

The loss from discontinued operations, during the three months ended September 30, 2017, was primarily related to legal expenses associated with previously sold operations. The loss from discontinued operations, during the nine months ended September 30, 2017, was primarily related to legal expenses associated with previously sold operations, offset in part by a reduction in an uncertain tax position due to the lapse of a statute.certain separate U.S. state jurisdictions.

Liquidity and Capital Resources

Cash and cash equivalents were $53.5 million as of September 30, 2017, as compared to $20.9 million as of December 31, 2016. During the nine months ended September 30, 2017, the Company generated net cash flow from operating activities of $114.6 million primarily from results of operations. Management believesWe believe that ~~Viad’s~~our existing sources of liquidity will be sufficient to fund operations and projected capital ~~commitments~~outlays for at least the next 12 ~~months.~~months and the longer term.

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


	June 30,		December 31,
(in thousands)	2023		2022
Unrestricted cash and cash equivalents(1)	$	53,179	$	59,719
Available capacity on Revolving Credit Facility(2)		95,041		86,670
Total available liquidity	$	148,220	$	146,389

(1)

As of ~~September~~June 30, ~~2017, the Company had~~2023, we held approximately ~~$49.0~~$41.5 million of ~~its~~our cash and cash equivalents ~~held~~ outside of the United States, consisting of ~~$31.9~~$15.4 million in Canada, ~~$7.8~~$10.3 million in ~~the Netherlands, $7.0 million in the United Kingdom, $1.2 million in Germany, $0.9~~Iceland, $8.9 million in the United Arab Emirates, ~~and $0.2~~$2.7 million in ~~certain~~the United Kingdom, $2.4 million in the Netherlands, $1.4 million in Germany, and $0.4 million in other countries. ~~There are certain earnings related to~~

(2)

Includes our total Revolving Credit Facility of $100 million less outstanding letters of credit of $5.0 million as of June 30, 2023 and $13.3 million as of December 31, 2022.

Cash provided by operating activities, supplemented by our existing cash and cash equivalents, is our primary source of liquidity for funding our strategic business requirements. During the ~~Company’s Canadian and Netherlands operations that have historically been deemed permanently reinvested. As of September~~six months ended June 30, ~~2017, the incremental tax associated with these earnings if the cash balances were repatriated to the United States would approximate $1.6 million.~~

~~Cash Flows~~

~~Operating Activities~~

Nine Months Ended

September 30,

(in thousands)

2017

2016

Net income

$
80,128

$
47,083

Depreciation and amortization

42,499

31,206

Deferred income taxes

318

(3,549
)
Loss from discontinued operations

408

771

Impairment charges (recoveries)

(29,098
)

120

Other non-cash items

14,369

13,083

Changes in assets and liabilities

6,019

26,708

Net cash provided by operating activities

$
114,643

$
115,422

~~Net~~2023, net cash provided by operating activities ~~decreased $0.8 million, primarily due to~~was $38.8 million.

Our short-term and long-term funding requirements include debt obligations, 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 ~~working capital, offset in part by an increase in results~~the operating environment.

Debt Obligations

Effective July 30, 2021, we entered into the $500 million 2021 Credit Facility. The 2021 Credit Facility provides for a $400 million Term Loan B and a $100 million Revolving Credit Facility. The proceeds of ~~operations.~~

~~Investing Activities~~

Nine Months Ended

September 30,

(in thousands)

2017

2016

Capital expenditures

$
(39,493
)

$
(32,582
)
Proceeds from insurance

31,570

—

Cash paid for acquired businesses, net

(1,661
)

(145,735
)
Proceeds from dispositions of property and other assets

734

774

Net cash used in investing activities

$
(8,850
)

$
(177,543
)

~~Net cash used in investing activities decreased $168.7 million, primarily due to cash payments,~~the Term Loan B, net of ~~cash acquired,~~$14.8 million in related fees, were used to repay the $327 million outstanding balance under our then $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 ~~$145.7~~January 31, 2023. The interest rate cap manages our exposure to interest rate increases on $300 million ~~for~~in borrowings under the 2016 acquisitions of ON Services, CATC, and the business of Maligne Lake Tours Ltd., and the Mount Royal Hotel fire-related insurance proceeds received in 2017, offset in part by an increase in capital expenditures.

~~Financing Activities~~

Nine Months Ended

September 30,

(in thousands)

2017

2016

Proceeds from borrowings

$
60,574

$
153,000

Payments on debt and capital lease obligations

(128,808
)

(86,989
)
Dividends paid on common stock

(6,119
)

(6,079
)
Debt issuance costs

(5
)

(340
)
Common stock purchased for treasury

(1,272
)

(679
)
Other

—

60

Net cash provided by (used in) financing activities

$
(75,630
)

$
58,973

Net cash used in financing activities increased $134.6 million primarily due to net debt payments of $68.2 million during the nine months ended September 30, 2017 compared to net debt proceeds of $66.0 million during the nine months ended September 30, 2016.

~~Debt and Capital Lease Obligations~~

Term Loan B. Refer to Note 1113 – ~~Debt and Capital Lease Obligations~~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. On March 28, 2023, we entered into the Second Amendment to the 2021 Credit Facility, which modified the interest coverage financial covenant. As of June 30, 2023, we were in compliance with all covenants under the Revolving Credit Facility. Refer to Note 12 – Debt and Finance Obligations of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for additional information.

Capital Expenditures

As of June 30, 2023, we have planned capital expenditures of approximately $75 million to $85 million for the next 12 months, including approximately $35 million on select growth projects, such as the development of FlyOver Chicago. 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 21 – Leases and Other and Note 19 – Pension and Postretirement Benefits of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for further ~~discussion.~~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


	Six Months Ended
	June 30,
(in thousands)	2023			2022
Net loss	$	(9,812	)	$	(10,181	)
Depreciation and amortization		25,279			26,486
Deferred income taxes		(961	)		(962	)
(Income) loss from discontinued operations		201			(327	)
Restructuring charges		645			2,080
Impairment charges		—			583
Gains on dispositions of property and other assets		(73	)		(154	)
Share-based compensation expense		5,912			5,469
Other non-cash items, net		2,496			5,384
Changes in operating assets and liabilities		15,113			15,640
Net cash provided by operating activities	$	38,800		$	44,018

Net cash provided by operating activities decreased $5.2 million primarily due to higher interest and tax payments, offset in part by improved operating results at GES and Pursuit.

Investing Activities


	Six Months Ended
	June 30,
(in thousands)	2023			2022
Capital expenditures	$	(32,193	)	$	(31,639	)
Cash paid for acquisitions, net		(41	)		(25,494	)
Proceeds from dispositions of property and other assets		82			161
Net cash used in investing activities	$	(32,152	)	$	(56,972	)

Net cash used in investing activities decreased $24.8 million primarily due to cash paid for the Glacier Raft Company acquisition in April of 2022.

Financing Activities


	Six Months Ended
	June 30,
(in thousands)	2023			2022
Proceeds from borrowings	$	21,806		$	54,668
Payments on debt and finance obligations		(27,157	)		(38,728	)
Dividends paid on preferred stock		(3,900	)		(3,900	)
Distributions to noncontrolling interest, net of contributions from noncontrolling interest		(1,126	)		(570	)
Payments of debt issuance costs		(226	)		(418	)
Payment of payroll taxes on stock-based compensation through shares withheld or repurchased		(505	)		(537	)
Net cash (used in) provided by financing activities	$	(11,108	)	$	10,515

The change in net cash (used in) provided by financing activities of $21.6 million was primarily due to net debt payments of $5.4 million during the six months ended June 30, 2023 compared to net debt proceeds of $15.9 million during the six months ended June 30, 2022.

Debt and Finance Obligations

Refer to Note 12 – Debt and Finance Obligations of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for further discussion, all of which is incorporated by reference herein.

Share Repurchases

~~The~~Our Board of Directors previously authorized ~~the Company~~us to repurchase shares of ~~its~~our common stock from time to time at prevailing market prices. ~~No open market repurchases were made during~~Effective February 7, 2019, our Board of Directors authorized the ~~nine months ended September 30, 2017 or 2016.~~repurchase of an additional 500,000 shares. As of ~~September~~June 30, ~~2017, 440,540~~2023, 546,283 shares remained available for ~~repurchase. The authorization of the~~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. ~~In addition, during~~

During both the ~~nine months ended September 30, 2017~~2023 and ~~2016, the Company~~2022 periods, we repurchased ~~26,916~~ shares ~~for $1.3 million and 24,432 shares for $0.7 million, respectively,~~ related to tax withholding requirements on vested restricted share-based awards.

Critical Accounting ~~Policies and~~ Estimates

Refer to ~~“Management’s~~Part II, Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations” (Part II, Item 7)~~Operations of ~~Viad’s Annual Report on~~our 2022 Form 10-K ~~for the year ended December 31, 2016,~~ for a discussion of our critical accounting ~~policies and~~ estimates.

Impact of Recent Accounting Pronouncements

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

~~Forward-Looking Statements~~

As provided by the safe harbor provision under the Private Securities Litigation Reform Act of 1995, Viad cautions readers that, in addition to historical information contained herein, this quarterly report includes certain information, assumptions, and discussions that may constitute forward-looking statements. These forward-looking statements are not historical facts, but reflect current estimates, projections, expectations, or trends concerning future growth, operating cash flows, availability of short-term borrowings, consumer demand, new or renewal business, investment policies, productivity improvements, ongoing cost reduction efforts, efficiency, competitiveness, legal expenses, tax rates and other tax matters, foreign exchange rates, and the realization of restructuring cost savings. Actual results could differ materially from those discussed in the forward-looking statements. Viad’s businesses can be affected by a host of risks and uncertainties. Among other things, natural disasters, gains and losses of customers, consumer demand patterns, labor relations, purchasing decisions related to customer demand for exhibition and event services, existing and new competition, industry alliances, consolidation and growth patterns within the industries in which Viad competes, acquisitions, capital allocations, adverse developments in liabilities associated with discontinued operations, changes in the levels of interest rates, and any deterioration in the economy, may individually or in combination impact future results. In addition to factors mentioned elsewhere, economic, competitive, governmental, technological, capital marketplace, and other factors, including terrorist activities or war, a pandemic health crisis, and international conditions, could affect the forward-looking statements in this quarterly report. Additional information concerning business and other risk factors that could cause actual results to materially differ from those in the forward looking statements are discussed in the “Risk Factors” section in Viad’s 2016 Annual Report.Non-GAAP Measure

Information about Viad obtained from sources other than the Company may be out-of-date or incorrect. Please rely only on Company press releases, SEC filings, and other information provided by the Company, keeping in mind that forward-looking statements speak only as of the date made. Viad undertakes no obligation to update any forward-looking statements, including prior forward-looking statements, to reflect events or circumstances arising after the date as of which the forward-looking statements were made.

~~Non-GAAP Measures~~

In addition to disclosing financial results that are determined in accordance with ~~U.S. generally accepted accounting principles (“GAAP”), the Company~~GAAP, we also ~~discloses non-GAAP financial measures of Adjusted EBITDA, Segment operating income, Adjusted Segment EBITDA, organic revenue, and organic~~disclose segment operating income ~~(collectively, the “Non-GAAP Measures”). The presentation~~(loss) as a non-GAAP financial measure. Our use of ~~the Non-GAAP Measures~~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, ~~the Non-GAAP Measures~~segment operating income (loss) may not be comparable to similarly titled measures used by other companies. ~~Management believes~~We believe that ~~the presentation~~our use of ~~the Non-GAAP Measures~~segment operating income (loss) provides useful information to investors regarding ~~Viad’s~~our results of operations for trending, analyzing, and benchmarking ~~the~~our performance and the value of ~~Viad’s~~our business.

~~“Adjusted EBITDA”~~ is defined by Viad as net income attributable to Viad before the Company’s portion of interest expense, income taxes, depreciation and amortization, impairment charges and recoveries, changes in accounting principles, and the effects of discontinued operations. Adjusted EBITDA is utilized by management to measure the profit and performance of Viad’s operations and to facilitate period-to-period comparisons. Refer to the table below for a reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure.

“Segment operating ~~income”~~ income (loss)”is ~~defined by Viad as~~ net income (loss) attributable to Viad before income (loss) from discontinued operations, corporate activities, interest expense and interest income, income taxes, restructuring charges, impairment ~~losses~~charges, and ~~recoveries,~~certain other corporate expenses that are not allocated to the reportable segments, and the reduction for income (loss) attributable to noncontrolling ~~interest.~~interests. Segment operating income (loss) is ~~utilized by management~~used to measure the profit and performance of ~~Viad’s~~our operating segments to facilitate period-to-period comparisons.

~~“Adjusted~~ Refer to Note 24 – Segment ~~EBITDA”~~ ~~is defined by Viad as~~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 ~~(as defined above)~~(loss) to income (loss) from continuing operations before ~~non-cash depreciation and amortization and acquisition integration costs, if any. Adjusted Segment EBITDA~~income taxes.

We believe segment operating income (loss) is ~~utilized by management to measure the profit and performance of Viad’s operating segments and acquisitions to facilitate period-to-period comparisons. For~~ a discussion of how this metric is used in connection with 2017 full year acquisition performance expectations, refer to the “Forward-Looking Non-GAAP Financial Measures” section of this MD&A. Management believes that Adjusted Segment EBITDA for acquisitions enables investors to assess how effectively management is investing capital into major corporate development projects, both from a valuation and return perspective.

•

~~“Organic revenue”~~ ~~and~~ ~~“organic segment operating income”~~ are defined by Viad as revenue and segment operating income (as defined above), respectively, without the impact of exchange rate variances and acquisitions, if any, until such acquisitions are included in the entirety of both comparable periods. The impact of exchange rate variances is calculated as the difference between current period activity translated at the current period’s exchange rates and the comparable prior period’s exchange rates. Management believes that the presentation of “organic” results permits investors to better understand Viad’s performance without the effects of exchange rate variances or acquisitions and to facilitate period-to-

period comparisons and analysis of Viad’s operating performance. Refer to the “Results of Operations” section of this MD&A for reconciliations of organic revenue and organic segment operating income to the most directly comparable GAAP measures.

~~The Non-GAAP Measures are considered~~ useful operating ~~metrics~~metric as it eliminates potential variations arising from taxes, ~~depreciation and amortization,~~ debt service costs, impairment charges, ~~and recoveries, changes in accounting principles,~~restructuring charges, the reduction of income (loss) attributable to non-controlling interests, and the effects of discontinued operations, ~~are eliminated, thus~~ resulting in an additional ~~measures~~measure considered to be indicative of ~~Viad’s~~our ongoing operations and segment performance. Although ~~the Non-GAAP Measures are used as financial measures~~we use segment operating income (loss) to assess the performance of ~~the~~our business, the use of ~~these measures~~this measure is limited because ~~these measures do~~this measure does not consider material costs, expenses, and other items necessary to operate, ~~the~~or resulting from, our business. ~~These items include debt service costs, non-cash depreciation and amortization expense associated with long-lived assets, expenses related to U.S. federal, state, local and foreign~~As segment operating income ~~taxes, impairment charges or recoveries, and the effects of accounting changes and discontinued operations. Since the Non-GAAP Measures do~~(loss) does not consider ~~the above~~these items, ~~a user of Viad’s financial information should consider~~ net income (loss) attributable to Viad should be considered as an important measure of financial performance because it provides a more complete measure of ~~the Company’s~~our performance.

~~A reconciliation of net income attributable to Viad to Adjusted EBITDA is as follows:~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in thousands)

2017

2016

2017

2016

Net income attributable to Viad

$
44,657

$
33,792

$
79,381

$
46,318

Depreciation and amortization

15,833

12,649

42,499

31,206

Interest expense

2,117

1,489

6,281

4,109

Income tax expense

20,010

17,878

32,929

23,652

Impairment charges (recoveries)

(24,467
)

120

(29,098
)

120

Loss from discontinued operations

101

221

408

771

Other noncontrolling interest

(739
)

(661
)

(697
)

(691
)
Adjusted EBITDA

$
57,512

$
65,488

$
131,703

$
105,485

The decrease in Adjusted EBITDA for the three months ended September 30, 2017 was primarily due to lower segment operating income at GES. The increase in Adjusted EBITDA for the nine months ended September 30, 2017 was primarily due to higher segment operating income at GES and Pursuit. Refer to the “Results of Operations” section of this MD&A for a discussion of fluctuations.

~~Forward-Looking Non-GAAP Financial Measures~~

The Company has also provided Adjusted Segment EBITDA and segment operating income as forward-looking Non-GAAP Measures within the “Results of Operations” section of this MD&A. The Company does not provide reconciliations of these forward-looking Non-GAAP Measures to the most directly comparable GAAP financial measures because, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible, not all of the information necessary for quantitative reconciliations of these forward-looking Non-GAAP Measures to the most directly comparable GAAP financial measures is available to the Company without unreasonable efforts. Consequently, any attempt to disclose such reconciliations would imply a degree of precision that could be confusing or misleading to investors. It is probable that these forward-looking Non-GAAP Measures may be materially different from the corresponding GAAP Measures.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

~~Viad’s~~Our market risk ~~exposures relate~~exposure relates to fluctuations in foreign exchange rates and interest ~~rates, and certain commodity prices.~~rates. Foreign exchange risk is the risk that fluctuating exchange rates will adversely affect ~~Viad’s~~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 ~~the earnings of Viad. Commodity risk is the risk that changing prices will adversely affect~~our financial position or results of operations.

~~Viad conducts its~~Our foreign operations are primarily in Canada, the United Kingdom, Iceland, the Netherlands, ~~Germany,~~United Arab Emirates, and ~~to a lesser extent, in certain other countries.~~Germany. The functional currency of ~~Viad’s~~our foreign subsidiaries is their local currency. Accordingly, for purposes of consolidation, ~~Viad translates~~we translate the assets and liabilities of ~~its~~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 ~~accumulated other comprehensive income~~AOCI in ~~Viad’s condensed consolidated balance sheets.~~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 ~~Viad’s~~our net equity position reported in ~~its condensed consolidated balance sheets. Viad does~~the Condensed Consolidated Balance Sheets. We do not currently hedge ~~its~~our equity risk

arising from the translation of foreign denominated assets and liabilities. ~~Viad had~~We recorded cumulative unrealized foreign currency translation losses ~~recorded~~ in stockholders’ equity of ~~$10.3 million and $29.1~~$35.0 million as of ~~September~~June 30, ~~2017~~2023 and $43.0 million as of December 31, ~~2016, respectively. During the three and nine months ended September 30, 2017,~~2022. We recorded unrealized foreign currency translation gains ~~of $9.1 million and $18.8 million, respectively, were recorded~~ in other comprehensive ~~income. During~~income (loss) of $8.0 million during the ~~three and nine~~six months ended ~~September~~June 30, ~~2016 an~~2023 and unrealized foreign currency translation ~~loss~~losses of ~~$3.8~~$8.1 million ~~and a gain of $0.7 million, respectively, were recorded in other comprehensive income.~~during the six months ended June 30, 2022.

For purposes of consolidation, revenue, expenses, gains, and losses related to ~~Viad’s~~our foreign operations are translated into U.S. dollars at the average foreign exchange rates for the period. As a result, ~~Viad’s~~our consolidated results of operations are exposed to fluctuations in foreign exchange rates as revenue and segment operating ~~results~~income (loss) of ~~its~~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. ~~Viad does~~We do not currently hedge ~~its net~~our earnings exposure arising from the translation of ~~its~~our foreign revenue and segment operating ~~results. Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a discussion on the “Foreign Exchange Rate Variances.”~~income (loss).

~~Viad is~~We are exposed to foreign exchange transaction risk, as ~~its~~our foreign subsidiaries have certain ~~revenue transactions~~loans and leases denominated in currencies other than the functional currency of the respective subsidiary. ~~From time to time, Viad utilizes forward contracts to mitigate the impact on earnings related to these transactions due to fluctuations~~As of June 30, 2023, we had long-term contractual liabilities that were denominated in nonfunctional currencies of $47.4 million. As foreign exchange ~~rates.~~rates fluctuate, these liabilities are remeasured, and the corresponding adjustment is recorded in the Condensed Consolidated Statements of Operations. As of ~~September~~June 30, ~~2017, Viad~~2023 and December 31, 2022, we did not have any outstanding foreign currency forward ~~contracts outstanding.~~contracts.

~~Viad is~~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 Term Loan B. Refer to Note 13 – 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 ~~its~~our other debt obligations. ~~Viad currently does not use derivative financial instruments to hedge cash flows for such obligations.~~

Item 4. Controls and Procedures

~~Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer of Viad, the effectiveness of the design and operation of~~We have established disclosure controls and procedures ~~has been evaluated as of September 30, 2017, and, based on~~ that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures are effective as of September 30, 2017. Disclosure controls and procedures are designed to ensure that information required to be disclosed in ~~the~~our reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and ~~forms. Disclosure controls~~forms, and ~~procedures include, without limitation, controls and procedures designed to ensure that~~such information ~~required to be disclosed in such reports~~ is accumulated and communicated to our management, including ~~the~~our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate to allow ~~for~~ timely decisions regarding required disclosure. Management, together with our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2023. Based on this evaluation, the CEO and CFO concluded that our disclosure controls and procedures were effective as of June 30, 2023.

~~There~~Previously Reported Material Weakness in Controls over Financial Reporting

During our year-end close and review procedures for the year ended December 31, 2022, a material weakness was identified over the remeasurement of monetary liabilities in nonfunctional currencies as a result of the error identified in accounting for a finance lease at the Company’s Sky Lagoon attraction in Iceland, which impacted costs of services, long-term debt and finance obligations, and net income attributable to Viad after accounting for taxes and noncontrolling interests. This error was corrected in the Form 10-Q/A for the quarter ended September 30, 2022, which was filed on February 28, 2023.

Remediation of the Material Weakness

We designed and have tested the implementation and operation of an internal control as of June 30, 2023 to identify and account for monetary liabilities denominated in a foreign currency and the resulting transaction gains and losses from a change in exchange rates to address the above previously reported material weakness. We believe these measures remediated the previously reported material weakness.We remain committed to maintaining a strong internal control environment and implementing measures designed to ensure a strong control environment.

Changes in Internal Control over Financial Reporting

Other than the remediation of the material weakness described above, there were no changes in ~~the Company’s~~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 ~~September~~June 30, ~~2017 that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.~~2023.

PART II - ~~OTHE~~ROTHER INFORMATION

Item 1. Legal Proceedings

Refer to Note 1822 – Litigation, Claims, Contingencies, and Other of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q) for information regarding legal proceedings ~~involving the Company.~~in which we are involved, which information is incorporated by reference herein.

Item 1A. Risk Factors

~~There were no material changes~~In addition to other information set forth in this report, careful consideration should be given to the ~~risk~~ factors ~~disclosed~~discussed in ~~Viad’s Annual Report on~~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 2022 Form 10-K, ~~for the year ended December 31, 2016,~~which could materially affect our business, financial condition, or ~~in our Form 10-Q for the quarter ended March 31, 2017.~~future results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table summarizes the total number of shares of ~~Viad’s~~our common stock that were repurchased during the three months ended ~~September~~June 30, ~~2017 by Viad~~2023 pursuant to publicly announced plans or programs, as well as ~~from~~certain previously owned shares of common stock that were surrendered by employees, former employees, and non-employee directors ~~surrendering previously owned Viad common stock (outstanding shares) to pay the taxes in connection with the vesting of restricted stock~~for tax withholding requirements on vested share-based awards.

ISSUER PURCHASES OF EQUITY SECURITIES

Period

Total Number of Shares Purchased

Average Price Paid
Per Share

Total Number of Shares
Purchased as Part of Publicly
Announced Plans or Programs

Maximum Number of Shares
That May Yet Be Purchased
Under the Plans or Programs

July 1, 2017 - July 31, 2017

—

$
—

—

440,540

August 1, 2017 - August 31, 2017

1,120

$
52.80

—

440,540

September 1, 2017 - September 30, 2017

154

$
56.05

—

440,540

Total

1,274

$
53.19

—

440,540


Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
April 1, 2023 - April 30, 2023		257	$	17.38		—		546,283
May 1, 2023 - May 31, 2023		—	$	—		—		546,283
June 1, 2023 - June 30, 2023		—	$	—		—		546,283
Total		257	$	17.38		—		546,283

~~The~~

Pursuant to previously announced authorizations, our Board of Directors authorized ~~the Company~~us to repurchase shares of ~~its~~our common stock from time to time at prevailing market prices. No shares were repurchased on the open market during the three and nine months ended September 30, 2017. As of September 30, 2017, 440,540 shares remain available for repurchase. The authorization of theEffective February 7, 2019, our Board of Directors authorized the repurchase of an additional 500,000 shares. In March 2020, our Board of Directors suspended future dividend payments and our share repurchase program for the foreseeable future. The Board of Directors’ authorization does not have an expiration date. During the second quarter of 2023, certain previously owned shares of common stock were surrendered for tax withholding requirements on vested share-based awards.

Item 5. OTHER INFORMATION

~~Not applicable.~~Securities Trading Plans of Directors and Executive Officers

During the three months ended June 30, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. E~~xhibits~~Exhibits

Incorporated by Reference

Exhibit

Number

Exhibit Description

Form

Period

Ending

Exhibit

Filing Date

~~4.1~~

~~Joinder to Guaranty, dated August 31, 2017, by and among ON Services – AV Specialists, Inc. and BMO Harris Bank, N.A.~~

31.1

~~Exhibit of~~ Certification of Chief Executive Officer of Viad Corp pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002~~2002.

~~31.2~~

31.2

~~Exhibit of~~ Certification of Chief Financial Officer of Viad Corp pursuant to Section 302 of the Sarbanes-Oxley Act of ~~2002~~2002.

~~32.1~~

32.1

~~Additional Exhibit of Certification~~Certifications of Chief Executive Officer ~~of Viad Corp pursuant to Section 906 of the Sarbanes-Oxley Act of 2002~~

~~32.2~~

~~Additional Exhibit of Certification of~~and Chief Financial Officer of Viad Corp pursuant to Section 906 of the Sarbanes-Oxley Act of ~~2002~~2002.

~~101.INS~~

~~XBRL Instance Document~~

~~101.SCH~~101.INS

***

Inline XBRL Instance Document

101.SCH

****

Inline XBRL Taxonomy Extension Schema ~~Document~~Document.

~~101.CAL~~

101.CAL

****

Inline XBRL Taxonomy Extension Calculation Linkbase ~~Document~~Document.

~~101.DEF~~

~~XBRL Taxonomy Extension Definition Linkbase Document~~

101.LAB

****

Inline XBRL Taxonomy Extension Label Linkbase ~~Document~~Document.

~~101.PRE~~

101.PRE

****

Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF

****

Inline XBRL Taxonomy Extension Definition Linkbase Document.

104

***

Cover Page Interactive Data File


*		Filed herewith.
**		Furnished herewith.
***		The Inline XBRL Instance Document and Cover Page Interactive Data File do not appear in the Interactive Data File because their XBRL tags are embedded within the Inline XBRL document.
****		Submitted electronically herewith.

**	~~Furnished herewith.~~

~~SIGNATURES~~42

SIGNATURES

Pursuant to the requirements ~~of Section 13 or 15(d)~~ of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	VIAD CORP
	(Registrant)

~~November 6, 2017~~August 4, 2023	By:	/s/ Leslie S. Striedel
(Date)		Leslie S. Striedel
		~~Chief Accounting Officer~~
		(Chief Accounting Officer and Duly Authorized ~~Officer)~~Officer


Delaware		36-1169950
(State or other jurisdiction of incorporation or ~~organization~~organization)		(I.R.S. Employer Identification No.)

~~1850 North Central~~7000 East 1st Avenue ~~Suite 1900~~ ~~Phoenix,~~ Scottsdale, Arizona		~~85004-4565~~85251-4304
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $1.50 Par Value	VVI	New York Stock Exchange


	September 30,			December 31,			June 30,			December 31,
(in thousands, except share data)	2017			2016			2023			2022
Assets
Current assets
Cash and cash equivalents	$	53,481		$	20,900		$	53,179		$	59,719
Accounts receivable, net of allowances for doubtful accounts of $1,897 and $1,342, respectively		129,105			104,648
Accounts receivable, net of allowances for doubtful accounts of $3,097 and $2,174, respectively								146,157			122,373
Inventories		39,753			31,420			15,844			10,785
Current contract costs								18,313			14,331
Prepaid insurance								8,641			13,370
Other current assets		23,973			18,449			27,058			18,977
Total current assets		246,312			175,417			269,192			239,555
Property and equipment, net		295,757			279,858			567,117			549,578
Other investments and assets		46,745			44,297			19,321			17,457
Operating lease right-of-use assets								112,263			102,777
Deferred income taxes		34,391			42,549			2,718			565
Goodwill		263,919			254,022			123,899			121,429
Other intangible assets, net		65,672			73,673			58,257			58,985
Total Assets	$	952,796		$	869,816		$	1,152,767		$	1,090,346
Liabilities and Stockholders’ Equity
Liabilities, Mezzanine Equity, and Stockholders’ Equity
Current liabilities
Accounts payable	$	88,510		$	67,596		$	106,059		$	73,020
Customer deposits		53,093			42,723
Contract liabilities								67,020			43,950
Accrued compensation		28,094			29,913			22,750			25,839
Operating lease obligations								15,087			13,463
Other current liabilities		52,318			30,390			37,788			41,653
Current portion of debt and capital lease obligations		124,574			174,968
Current portion of debt and finance obligations								8,382			13,192
Total current liabilities		346,589			345,590			257,086			211,117
Long-term debt and capital lease obligations		60,627			74,243
Long-term debt and finance obligations								459,482			456,752
Pension and postretirement benefits		26,826			28,611			16,399			16,769
Long-term operating lease obligations								109,143			101,297
Other deferred items and liabilities		50,260			50,734			73,363			70,024
Total liabilities		484,302			499,178			915,473			855,959
Commitments and contingencies
Convertible Series A Preferred Stock, $0.01 par value, 180,000 shares authorized, 135,000 shares issued and outstanding								132,591			132,591
Redeemable noncontrolling interest								4,727			4,956
Stockholders’ equity
Viad Corp stockholders’ equity:
Common stock, $1.50 par value, 200,000,000 shares authorized, 24,934,981 shares issued and outstanding		37,402			37,402
Common stock, $1.50 par value, 200,000,000 shares authorized, 24,934,981 shares issued and outstanding								37,402			37,402
Additional capital		573,660			573,841			569,733			570,271
Retained earnings		89,552			16,291
Unearned employee benefits and other		239			172
Accumulated other comprehensive income (loss):
Unrealized gain on investments		564			421
Cumulative foreign currency translation adjustments		(10,264	)		(29,084	)
Unrecognized net actuarial loss and prior service credit, net		(10,544	)		(10,728	)
Common stock in treasury, at cost, 4,519,023 and 4,613,520 shares, respectively		(226,145	)		(230,960	)
Total Viad Corp stockholders’ equity		454,464			357,355
Noncontrolling interest		14,030			13,283
Accumulated deficit								(348,109	)		(334,301	)
Accumulated other comprehensive loss								(38,770	)		(47,185	)
Common stock in treasury, at cost, 4,068,448 and 4,216,044 shares, respectively								(203,769	)		(211,657	)
Total Viad stockholders’ equity								16,487			14,530
Non-redeemable noncontrolling interest								83,489			82,310
Total stockholders’ equity		468,494			370,638			99,976			96,840
Total Liabilities and Stockholders’ Equity	$	952,796		$	869,816
Total Liabilities, Mezzanine Equity, and Stockholders’ Equity							$	1,152,767		$	1,090,346

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in thousands)	2017			2016			2017			2016
Net income	$	45,741		$	34,784		$	80,128		$	47,083
Other comprehensive income (loss):
Unrealized gains on investments, net of tax⁽¹⁾		48			42			143			62
Unrealized foreign currency translation adjustments, net of tax⁽¹⁾		9,115			(3,849	)		18,820			723
Change in net actuarial gain, net of tax⁽¹⁾		103			93			385			334
Change in prior service cost, net of tax⁽¹⁾		(67	)		(78	)		(201	)		(234	)
Comprehensive income		54,940			30,992			99,275			47,968
Comprehensive income attributable to noncontrolling interest		(1,084	)		(992	)		(747	)		(765	)
Comprehensive income attributable to Viad	$	53,856		$	30,000		$	98,528		$	47,203


	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in thousands)	2023			2022			2023			2022
Net income (loss)	$	11,578		$	20,162		$	(9,812	)	$	(10,181	)
Other comprehensive income (loss):
Unrealized foreign currency translation adjustments		6,755			(11,543	)		7,950			(8,131	)
Change in fair value of interest rate cap		1,238			—			438			—
Change in net actuarial loss, net of tax (1)		33			59			(12	)		466
Change in prior service cost, net of tax (1)		4			—			39			—
Comprehensive income (loss)		19,608			8,678			(1,397	)		(17,846	)
Non-redeemable noncontrolling interest:
Comprehensive income (loss) attributable to non-redeemable noncontrolling interest		(903	)		(451	)		(505	)		753
Unrealized foreign currency translation adjustments		1,235			(2,014	)		1,800			(1,277	)
Redeemable noncontrolling interest:
Comprehensive loss attributable to redeemable noncontrolling interest		286			128			409			266
Comprehensive income (loss) attributable to Viad	$	20,226		$	6,341		$	307		$	(18,104	)


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


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


Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐


		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	1
	Condensed Consolidated Balance Sheets as of ~~September~~June 30, ~~2017~~2023 and December 31, ~~2016~~2022	1
	Condensed Consolidated Statements of Operations for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2023 and ~~2016~~2022	2
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2023 and ~~2016~~2022	3
	Condensed Consolidated Statements of Stockholders’ Equity and Mezzanine Equity for the Three Months Ended March 31 and June 30, 2023 and 2022	4
	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2017~~2023 and ~~2016~~2022	46
	Notes to Condensed Consolidated Financial Statements	57
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2331
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3739
Item 4.	Controls and Procedures	3840
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	3941
Item 1A.	Risk Factors	3941
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3941
Item 5.	Other Information	3941
Item 6.	Exhibits	4042

SIGNATURES		4043


																								Mezzanine Equity
(in thousands)	Common Stock		Additional Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Common Stock in Treasury			Total Viad Equity			Non-Redeemable Non-Controlling Interest			Total Stockholders’ Equity			Redeemable Non-Controlling Interest			Convertible Series A Preferred Stock
Balance, December 31, 2022	$	37,402	$	570,271		$	(334,301	)	$	(47,185	)	$	(211,657	)	$	14,530		$	82,310		$	96,840		$	4,956		$	132,591
Net loss		—		—			(20,869	)		—			—			(20,869	)		(398	)		(21,267	)		(123	)		—
Dividends on convertible preferred stock		—		—			(1,950	)		—			—			(1,950	)		—			(1,950	)		—			—
Change in fair value of interest rate cap		—		—			—			(800	)		—			(800	)		—			(800	)		—			—
Payment of payroll taxes on stock-based compensation through shares withheld		—		—			—			—			(204	)		(204	)		—			(204	)		—			—
Employee benefit plans		—		(4,677	)		—			—			5,468			791			—			791			—			—
Share-based compensation - equity awards		—		3,064			—			—			—			3,064			—			3,064			—			—
Unrealized foreign currency translation adjustment		—		—			—			1,195			—			1,195			565			1,760			142			—
Amortization of net actuarial loss, net of tax		—		—			—			(45	)		—			(45	)		—			(45	)		—			—
Amortization of prior service cost, net of tax		—		—			—			35						35						35
Other, net		—		3			—			—			2			5			—			5			—			—
Balance, March 31, 2023	$	37,402	$	568,661		$	(357,120	)	$	(46,800	)	$	(206,391	)	$	(4,248	)	$	82,477		$	78,229		$	4,975		$	132,591
Net income (loss)		—		—			10,961			—			—			10,961			903			11,864			(286	)		—
Dividends on convertible preferred stock		—		—			(1,950	)		—			—			(1,950	)		—			(1,950	)		—			—
Distributions to noncontrolling interest		—		—			—			—			—			—			(1,126	)		(1,126	)		—			—
Change in fair value of interest rate cap		—		—			—			1,238			—			1,238			—			1,238			—			—
Payment of payroll taxes on stock-based compensation through shares withheld		—		—			—			—			(4	)		(4	)		—			(4	)		—			—
Employee benefit plans		—		(1,773	)		—			—			2,628			855			—			855			—			—
Share-based compensation - equity awards		—		2,830			—			—			—			2,830			—			2,830			—			—
Unrealized foreign currency translation adjustment		—		—			—			6,755			—			6,755			1,235			7,990			38			—
Amortization of net actuarial loss, net of tax		—		—			—			33			—			33			—			33			—			—
Amortization of prior service cost, net of tax		—		—			—			4			—			4			—			4			—			—
Other, net		—		15			—			—			(2	)		13			—			13			—			—
Balance, June 30, 2023	$	37,402	$	569,733		$	(348,109	)	$	(38,770	)	$	(203,769	)	$	16,487		$	83,489		$	99,976		$	4,727		$	132,591


Standard	Description	Date of adoption	Effect on the financial statements
Standards Recently Adopted
Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers	Amendment relates to the application of Topic 805, Business Combinations, to contracts with a customer acquired in a business combination after the acquirer has adopted Topic 606. ASU 2021-08 requires contract assets and contract liabilities to be accounted for as if they (the acquirer) entered into the original contract at the same time and same date as the acquiree.	1/1/2023	The adoption of this new standard did not have a material impact on our consolidated financial statements.
ASU 2022-04, Liabilities- Supplier Finance Programs (Subtopic 405-50) Disclosure of Supplier Finance Program Obligations	Amendment requires that a buyer in a supplier finance program disclose key terms about the program in connection with the purchase of goods and services along with information about their obligations under these programs, including a rollforward of those obligations.	1/1/2023	We provide disclosure about supplier finance programs in Note 12 - Debt and Finance Obligations under the heading “Financing arrangements.” The required rollforward requirement is effective in the first quarter of 2024. The adoption of this new standard on January 1, 2023 did not otherwise have a material impact on our related disclosures.

	PUP Awards					Restricted Stock					Restricted Stock Units
	Shares			Weighted-Average Grant Date Fair Value		Shares			Weighted-Average Grant Date Fair Value		Shares			Weighted-Average Grant Date Fair Value
Balance at December 31, 2016		255,505		$	26.11		267,051		$	25.96		15,982		$	25.58
Granted		73,557		$	47.44		64,648		$	46.64		2,950		$	47.45
Vested		(76,082	)	$	23.66		(79,104	)	$	24.01		(6,182	)	$	25.05
Forfeited		(5,911	)	$	30.64		(9,807	)	$	33.84		—		$	—
Balance at September 30, 2017		247,069		$	33.10		242,788		$	31.79		12,750		$	30.90

	Three Months Ended		Nine Months Ended
(in thousands, except per share data)	September 30, 2016		September 30, 2016
Revenue	$	389,877	$	991,818
Depreciation and amortization	$	14,427	$	39,565
Income from continuing operations	$	35,047	$	47,734
Net income attributable to Viad	$	33,834	$	46,198
Diluted income per share	$	1.67	$	2.28
Basic income per share	$	1.67	$	2.28

(in thousands)	GES U.S.		GES International		Pursuit		Total
Balance at December 31, 2016	$	148,277	$	34,460	$	71,285	$	254,022
Business acquisitions		—		1,060		—		1,060
Foreign currency translation adjustments		—		3,084		5,753		8,837
Balance at September 30, 2017	$	148,277	$	38,604	$	77,038	$	263,919


	September 30, 2017							December 31, 2016								June 30, 2023							December 31, 2022
(in thousands)	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Useful Life (Years)	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
Amortized intangible assets:
Intangible assets subject to amortization:
Customer contracts and relationships	$	68,739	$	(21,505	)	$	47,234	$	67,762	$	(14,345	)	$	53,417	7.6	$	34,701	$	(28,798	)	$	5,903	$	37,194	$	(30,109	)	$	7,085
Operating contracts and licenses		10,038		(1,083	)		8,955		9,315		(652	)		8,663	33.8		40,285		(4,145	)		36,140		38,993		(3,504	)		35,489
In-place lease															33.3		14,755		(1,618	)		13,137		14,420		(1,404	)		13,016
Tradenames		8,665		(2,613	)		6,052		8,324		(1,440	)		6,884	3.6		5,667		(3,760	)		1,907		5,546		(3,324	)		2,222
Non-compete agreements		5,358		(2,682	)		2,676		5,190		(1,369	)		3,821
Other		896		(601	)		295		886		(458	)		428	4.7		787		(186	)		601		770		(163	)		607
Total amortized intangible assets		93,696		(28,484	)		65,212		91,477		(18,264	)		73,213			96,195		(38,507	)		57,688		96,923		(38,504	)		58,419
Unamortized intangible assets:
Indefinite-lived intangible assets:
Business licenses		460		—			460		460		—			460			569		—			569		566		—			566
Other intangible assets	$	94,156	$	(28,484	)	$	65,672	$	91,937	$	(18,264	)	$	73,673
Other intangible assets, net																$	96,764	$	(38,507	)	$	58,257	$	97,489	$	(38,504	)	$	58,985


(in thousands)
Year ending December 31,
Remainder of 2023	$	2,276
2024		3,679
2025		2,378
2026		2,344
2027		1,938
Thereafter		45,073
Total	$	57,688

(in thousands)
Year ending December 31,
Remainder of 2017	$	2,812
2018		11,014
2019		9,946
2020		8,446
2021		7,450
Thereafter		25,544
Total	$	65,212


	June 30,			December 31,
(in thousands, except interest rates)	2023			2022
2021 Credit Facility - Term Loan B, 10.2% interest rate at June 30, 2023 and 9.4% at December 31, 2022, due through 2028(1)	$	393,000		$	395,000
Jasper Term Loan, 6.5% interest rate at June 30, 2023, due through 2028(1)		12,655			—
Jasper Revolving Credit Facility, 9.2% weighted-average interest rate at June 30, 2023, due through 2028(1)		3,020			—
Forest Park Hotel Construction Loan, 8.8% interest rate at December 31, 2022(1)		—			11,491
FlyOver Iceland Credit Facility, 8.4% interest rate at June 30, 2023 and 6.9% at December 31, 2022, due through 2027(1)		4,528			4,965
FlyOver Iceland Term Loans, 13.1% weighted-average interest rate at June 30, 2023 and 10.1% at December 31, 2022, due through 2024(1)		535			594
Less unamortized debt issuance costs		(10,012	)		(11,848	)
Total debt		403,726			400,202
Finance lease obligations, 9.1% weighted-average interest rate at June 30, 2023 and December 31, 2022, due through 2067		63,961			64,729
Financing arrangements		177			5,013
Total debt and finance obligations (2)(3)		467,864			469,944
Current portion		(8,382	)		(13,192	)
Long-term debt and finance obligations	$	459,482		$	456,752


			Fair Value Measurements at Reporting Date Using
(in thousands)	June 30, 2023		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Other mutual funds (1)	$	4,049	$	4,049	$	—	$	—
Interest rate cap (2)		681		—		681		—
Total assets at fair value on a recurring basis	$	4,730	$	4,049	$	681	$	—

(in thousands)	Total Viad Stockholders’ Equity			Noncontrolling Interest		Total Stockholders’ Equity
Balance at December 31, 2016	$	357,355		$	13,283	$	370,638
Net income		79,381			747		80,128
Dividends on common stock ($0.30 per share)		(6,119	)		—		(6,119	)
Common stock purchased for treasury		(1,272	)		—		(1,272	)
Employee benefit plans		5,916			—		5,916
Unrealized foreign currency translation adjustment		18,820			—		18,820
Other changes to AOCI		327					327
Other		56			—		56
Balance at September 30, 2017	$	454,464		$	14,030	$	468,494


(in thousands)	Unrealized Gains on Investments			Cumulative Foreign Currency Translation Adjustments			Unrecognized Net Actuarial Loss and Prior Service Credit, Net			Accumulated Other Comprehensive Income (Loss)			Cumulative Foreign Currency Translation Adjustments			Unrecognized Net Actuarial Loss and Prior Service Credit, Net			Unrealized Gain on Interest Rate Cap			Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2016	$	421		$	(29,084	)	$	(10,728	)	$	(39,391	)
Balance at December 31, 2022													$	(42,983	)	$	(4,202	)	$	—		$	(47,185	)
Other comprehensive income before reclassifications		188			18,820			—			19,008			7,950			—			681			8,631
Amounts reclassified from AOCI, net of tax		(45	)		—			184			139			—			27			(243	)		(216	)
Net other comprehensive income		143			18,820			184			19,147			7,950			27			438			8,415
Balance at September 30, 2017	$	564		$	(10,264	)	$	(10,544	)	$	(20,244	)
Balance at June 30, 2023													$	(35,033	)	$	(4,175	)	$	438		$	(38,770	)

	Nine Months Ended September 30,						Affected Line Item in the Statement Where Net Income is Presented
(in thousands)	2017			2016
Unrealized gains on investments	$	(72	)	$	(67	)	Interest income
Tax effect		27			25		Income taxes
	$	(45	)	$	(42	)

Recognized net actuarial loss⁽¹⁾	$	596		$	538
Amortization of prior service credit⁽¹⁾		(323	)		(377	)
Tax effect		(89	)		(61	)	Income taxes
	$	184		$	100


	Domestic Plans																		Domestic Plans
	Pension Plans						Postretirement Benefit Plans						Foreign Pension Plans						Pension Plans					Postretirement Benefit Plans					Foreign Pension Plans
(in thousands)	2017			2016			2017			2016			2017			2016			2023			2022		2023			2022		2023			2022
Service cost	$	8		$	54		$	22		$	5		$	138		$	123		$	—		$	—	$	6		$	10	$	44		$	76
Interest cost		197			257			92			126			120			124			211			125		93			54		91			79
Expected return on plan assets		(55	)		(62	)		—			—			(156	)		(142	)		(40	)		51		—			—		(86	)		(98	)
Amortization of prior service credit		—			—			(107	)		(125	)		—			—			(8	)		—		29			22		—			—
Recognized net actuarial loss		106			105			3			46			48			1
Net periodic benefit cost	$	256		$	354		$	10		$	52		$	150		$	106
Recognized net actuarial loss (gain)																				71			134		(44	)		23		34			36
Net periodic benefit cost (income)																			$	234		$	310	$	84		$	109	$	83		$	93
Settlement cost																				—			—		—			—		—			—
Total expenses (income)																			$	234		$	310	$	84		$	109	$	83		$	93


	GES						Other Restructurings						GES						Other Restructurings
(in thousands)	Severance & Employee Benefits			Facilities			Severance & Employee Benefits			Total			Severance & Employee Benefits			Facilities			Severance & Employee Benefits			Total
Balance at December 31, 2016	$	2,274		$	1,092		$	416		$	3,782
Balance at December 31, 2022													$	1,609		$	1,818		$	12		$	3,439
Restructuring charges		442			237			138			817			227			409			9			645
Cash payments		(1,048	)		(449	)		(451	)		(1,948	)		(297	)		(481	)		(14	)		(792	)
Adjustment to liability		—			—			2			2			—			46			(7	)		39
Balance at September 30, 2017	$	1,668		$	880		$	105		$	2,653
Balance at June 30, 2023													$	1,539		$	1,792		$	—		$	3,331


(in thousands)	Operating Leases			Finance Leases			Total
Remainder of 2023	$	10,511		$	4,163		$	14,674
2024		25,910			7,919			33,829
2025		23,878			7,090			30,968
2026		22,931			6,487			29,418
2027		19,367			6,277			25,644
Thereafter		69,059			180,986			250,045
Total future lease payments		171,656			212,922			384,578
Less: Amount representing interest		(47,426	)		(148,961	)		(196,387	)
Present value of minimum lease payments		124,230			63,961			188,191
Current portion		(15,087	)		(2,650	)		(17,737	)
Long-term portion	$	109,143		$	61,311		$	170,454


(in thousands)	Glacier Park Inc.			Brewster (1)			Sky Lagoon			Total
Balance at December 31, 2022	$	16,690		$	55,702		$	9,918		$	82,310
Net income (loss) attributable to non-redeemable noncontrolling interest		(783	)		(24	)		1,312			505
Distributions to non-controlling interests		—			—			(1,126	)		(1,126	)
Foreign currency translation adjustments		6			1,279			515			1,800
Balance at June 30, 2023	$	15,913		$	56,957		$	10,619		$	83,489
Equity ownership interest that we do not own		20	%		40	%		49	%

	Revenue						Segment Operating Results
	Weighted-Average Exchange Rates				FX Impact		Weighted-Average Exchange Rates				FX Impact
	2017		2016		(in thousands)		2017		2016		(in thousands)
GES:
Canada (CAD)	$	0.80	$	0.77	$	680	$	0.80	$	0.77	$	44
United Kingdom (GBP)	$	1.32	$	1.31		235	$	1.31	$	1.32		115
Europe (EUR)	$	1.19	$	1.12		382	$	1.18	$	1.14		13
						1,297						172
Pursuit
Canada (CAD)	$	0.80	$	0.77		2,119	$	0.80	$	0.77		1,218
					$	3,416					$	1,390

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs
July 1, 2017 - July 31, 2017		—	$	—		—		440,540
August 1, 2017 - August 31, 2017		1,120	$	52.80		—		440,540
September 1, 2017 - September 30, 2017		154	$	56.05		—		440,540
Total		1,274	$	53.19		—		440,540