Viad Corp Announces Preliminary Results for the 2020 First Quarter, Provides Update on Liquidity and COVID-19 Impacts

Viad Corp (NYSE: VVI) today reported preliminary financial results for the first quarter of 2020. These preliminary results do not include anticipated non-cash impairment charges due to the impact of COVID-19, which will be reflected in Viad's GAAP financials upon filing our Form 10-Q.

COVID-19 Business Impacts

Steve Moster, president and chief executive officer, commented, "The COVID-19 pandemic is having a material impact on our operations and financial performance, with live event and tourism activities largely shut down. As select areas of the global economy have begun to re-open, primarily at the discretion of local authorities, we are beginning to restart our business with enhanced health and safety protocols in place. On May 7^th, we re-opened FlyOver Iceland, and we plan to begin re-opening other Pursuit experiences in June as restrictions are eased. However, exhibition and event activity has yet to resume."

Moster continued, "Given the evolving, uncertain nature of COVID-19, it is impossible to predict how the pandemic will continue to impact the events industry and the broader travel market. Accordingly, we are unable to provide financial guidance at this time."

Moster concluded, "I am very proud of how our team has responded to these unprecedented circumstances. We acted swiftly to protect the health and safety of our employees, clients, guests, and communities to help limit the spread of the virus, while also making difficult decisions to shutter operations and reduce staffing levels, amongst other actions to reduce costs. Our industries and our businesses have endured prior periods of disruption and we are determined to take the appropriate steps to help ensure we are able to weather this turbulent time."

First Quarter 2020 Preliminary Results

Preliminary revenue was $306.0 million, up 7.1% from the 2019 first quarter primarily due to positive show rotation of approximately $57 million at GES, partially offset by show postponements and cancellations due to the COVID-19 pandemic. Preliminary net loss attributable to Viad was $10.6 million, versus a loss of $17.8 million in the 2019 first quarter. Preliminary adjusted segment operating loss* was $8.4 million, versus a loss of $11.0 million in the prior year quarter, and adjusted segment EBITDA* was $6.9 million, up $4.7 million from the 2019 first quarter. The increase in adjusted segment EBITDA was primarily due to higher revenue at GES and the elimination of performance-based incentives, partially offset by increased seasonal operating losses at Pursuit driven primarily by our June 2019 Mountain Park Lodges acquisition and the opening of FlyOver Iceland.

* Refer to Table 2 of this press release for a discussion and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure.

Moster further commented, "Through the end of February, both GES and Pursuit were on pace for a strong first quarter. In early March, as a result of COVID-19 concerns, we began to see event postponements and cancellations at GES, as well as some cancelled bookings at Pursuit. This quickly escalated into the shut-down of event activity and tourism as government mandated closures and stay-at-home orders went more broadly into effect around the world."

"Our focus will continue to be on cash flow as we manage through this challenging and uncertain time. As demand halted, we essentially placed our businesses into a state of hibernation to preserve cash. At Pursuit, we have begun to thoughtfully re-open our attractions and hotels as governmental restrictions are being lifted and new reservations are once again coming in. For GES, we are cautiously optimistic that, as governments lift restrictions, events in certain geographies will start to take place again during the third quarter and we stand ready to reactivate areas of that business when it makes sense to do so. I want to thank our teams for everything they are doing to support our businesses during this unprecedented time," stated Moster.

Liquidity Update

We have taken the following measures to improve our liquidity position in response to COVID-19:

• We have fully drawn on our revolving line of credit to increase our cash position and we have obtained a waiver of our financial covenants for the second quarter.
• We have implemented aggressive cost reduction actions, including furloughs, mandatory unpaid time off, and salary reductions for all employees across the company. Our executive management team voluntarily reduced its base salaries by 20% to 50%.
• We have eliminated all non-essential capital expenditures and discretionary spending.
• Each non-employee member of our Board of Directors has agreed to reduce his or her cash retainer by 50% for payments typically made to them in the second quarter of 2020.
• We have suspended future dividend payments and share repurchases.
• We have taken advantage of available governmental assistance programs for wage and tax relief and continue to evaluate additional opportunities.

At March 31, 2020, our total cash was $130.5 million and our debt totaled $440.6 million, with $33 million of capacity remaining on our revolving credit facility. We drew the remaining $33 million at the beginning of April, bringing our cash position to approximately $163 million.

"Based on the very difficult, yet necessary actions we have taken to reduce costs and preserve cash, and as we continue to collect accounts receivable, we anticipate that our cash outflow during the second quarter will approximate $40 million. This leaves us ample liquidity to withstand the near-term impacts of COVID-19. Additionally, we are in productive discussions with our lender group for longer-term covenant relief, as we evaluate options to help ensure we have adequate liquidity for the future," said Moster.

Delay of First Quarter 2020 Form 10-Q Filing

The impact of COVID-19 on our business has resulted in the need to perform additional asset impairment assessments, which will delay the filing of our first quarter Form 10-Q. The preliminary financial results discussed in this press release do not include impairment charges and the corresponding tax effects, which are currently being evaluated. We do not expect the non-cash impairment charges to impact future operations or affect our liquidity or compliance with debt covenants. However, we expect the impact on Viad's reported GAAP financial results to be material.

Conference Call Details

To join the live teleconference, please call (833) 513-0557 and enter the passcode 2041759 or access the webcast through our website. A replay will be available for a limited time at (800) 585-8367 or (416) 621-4642 and enter the passcode 2041759 or visit our website and link to a replay of the webcast.

About Viad

Viad (NYSE: VVI) generates revenue and shareholder value through two businesses: Pursuit and GES. Pursuit is a collection of inspiring and unforgettable travel experiences in Alaska, Montana, the Canadian Rockies, Vancouver, and Reykjavik, as well as new experiences in development in Las Vegas and Toronto. Pursuit's collection includes attractions, lodges and hotels, and sightseeing tours that connect guests with iconic places. GES is a global, full-service live events company offering a comprehensive range of services to the world's leading brands and event organizers. Our business strategy focuses on providing superior experiential services to our customers and sustainable returns on invested capital to our shareholders. Viad is an S&P SmallCap 600 company. For more information, visit www.viad.com.

Preliminary Results

The unaudited preliminary financial results for the first quarter 2020 represent the most current information available to us and are based on calculations or figures that we prepared internally and they have not been reviewed or audited by our independent registered public accounting firm. Our actual results may differ materially from these preliminary financial results due to the completion of our financial closing procedures, including impairment testing, final adjustments, and other developments that may arise between the date of this announcement and when results for the first quarter 2020 are finalized and reported in our Form 10-Q.

Forward-Looking Statements

This press release contains a number of forward-looking statements. Words, and variations of words, such as "will," "may," "expect," "would," "could," "might," "intend," "plan," "believe," "estimate," "anticipate," "deliver," "seek," "aim," "potential," "target," "outlook," and similar expressions are intended to identify our forward-looking statements. Similarly, statements that describe our business strategy, outlook, objectives, plans, 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:

• the effects of the COVID-19 pandemic on our business;
• the impact of the pandemic and actions taken in response to the pandemic on global and regional economies, travel and economic activity;
• the pace of recovery when the COVID-19 pandemic subsides;
• general economic uncertainty in key global markets and a worsening of global economic conditions;
• our ability to successfully integrate and achieve established financial and strategic goals from acquisitions;
• our dependence on large exhibition event clients;
• the importance of key members of our account teams to our business relationships;
• the competitive nature of the industries in which we operate;
• travel industry disruptions;
• unanticipated delays and cost overruns of our capital projects, and our ability to achieve established financial and strategic goals for such projects;
• seasonality of our businesses;
• transportation disruptions and increases in transportation costs;
• natural disasters, weather conditions, and other catastrophic events;
• our multi-employer pension plan funding obligations;
• our exposure to labor cost increases and work stoppages related to unionized employees;
• liabilities relating to prior and discontinued operations;
• adverse effects of show rotation on our periodic results and operating margins;
• our exposure to currency exchange rate fluctuations;
• our exposure to cybersecurity attacks and threats;
• compliance with laws governing the storage, collection, handling, and transfer of personal data and our exposure to legal claims and fines for data breaches or improper handling of such data;
• the effects of the United Kingdom's exit from the European Union; and
• changes affecting the London Inter-bank Offered Rate.

For a more complete discussion of the risks and uncertainties that may affect our business or financial results, please see Item 1A, "Risk Factors," of our most recent annual report on Form 10-K filed with the SEC. We disclaim and do not undertake any obligation to update or revise any forward-looking statement in this press release except as required by applicable law or regulation.