Viad reports $3 million in earnings

By Richard N. Velotta (contact)

Tuesday, July 27, 2010 | 6:12 p.m.

Viad Corp, parent company of Las Vegas-based convention services contractor Global Experience Specialists, said the convention and meetings industry appears to be stabilizing after reporting that earnings narrowed in the company’s second quarter.

Phoenix-based Viad reported $3 million in earnings, 15 cents a share, on revenue of $218.3 million for the quarter that ended June 30. That compared with earnings of $5.4 million, 26 cents a share, on revenue of $213.6 million in the same quarter a year earlier.

Earnings beat analysts’ expectations with experts anticipating earnings of 9 cents a share.

Paul Dykstra, the company’s chairman, president and CEO, said Viad’s business groups – Marketing & Events and Travel & Recreation – performed better than the company had projected but the convention side is still mired in recession.

“After seven straight quarters of recessionary declines, U.S.-based same-show revenues were essentially flat to 2009, indicating that the exhibition and event industry appears to be stabilizing,” Dykstra said in a release announcing the company’s earnings.

“The pricing environment, however, remains challenging especially in the U.S. In response, our Marketing & Events Group remains focused on executing against the key initiatives we commenced during 2009. Our ongoing ‘Lean Initiatives’ are delivering sustainable productivity improvements and customer service enhancements and we continue to drive down overhead costs through the rationalization of facilities and other consolidation activities.”

The Marketing & Events Group includes GES with divisions that operate in Europe and the Middle East.

Dykstra said positive show rotation – events that don’t occur every year but will run in 2010 – should increase revenue by $20 million to $25 million for the year.

Dykstra said first quarter show rotation negatively impacted revenue by $8 million, the second quarter had no meaningful impact, the third quarter is expected to see an improvement by about $25 million and the fourth quarter should be negatively impacted by $5 million.

Total revenue is expected to increase slightly from 2009 with show rotation and new business offsetting anticipated same-show declines, which are expected to be down by a single-digit percentage rate.

Viad’s Transportation & Recreation Group includes Brewster Inc., a tourism operator in western Canada, and Glacier Park Inc., which operates a hotel and concessions at Waterton-Glacier International Peace Park on Montana’s border with Canada. The Transportation & Recreation Group saw a bump in charter bus revenue as a result of the Olympic Games in Vancouver and revenue is expected to increase slightly as a result of a centennial celebration at Glacier National Park.