2014
ANNUAL
REPORT
DEAR FELLOW SHAREHOLDERS
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revenue
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FIT3 wall system that provides an
enhanced, streamlined appearance,
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•
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on a constant currency basis
At December 31, 2014, our balance sheet remained
strong with cash and cash equivalents totaling $57.0
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Our strong balance sheet enabled us to return a total
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lion investment in our stock through share repurchas-
es during 2014.
Steve Moster
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We are committed to providing best
in class experiences to our clients,
customers and guests by offering
products and services designed to
meet their current and future needs.
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full-service provider for live events. With the acquisi-
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MAGIC Market Week showcased
GES’ unique FIT3 wall system,
created by our in-house design-
ers and engineers. This biannual
event showcased 5,000 exhibi-
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hospitality assets at both entrances
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as well as another rare in-holding
(cid:449)(cid:349)(cid:410)(cid:346)(cid:349)(cid:374)(cid:3)(cid:39)(cid:367)(cid:258)(cid:272)(cid:349)(cid:286)(cid:396)(cid:3)(cid:69)(cid:258)(cid:415)(cid:381)(cid:374)(cid:258)(cid:367)(cid:3)(cid:87)(cid:258)(cid:396)(cid:364)(cid:856)
(cid:349)(cid:374)(cid:882)(cid:346)(cid:381)(cid:437)(cid:400)(cid:286)(cid:3)(cid:104)(cid:856)(cid:94)(cid:856)(cid:3)(cid:4)(cid:115)(cid:3)(cid:410)(cid:286)(cid:258)(cid:373)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:346)(cid:396)(cid:381)(cid:437)(cid:336)(cid:346)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:258)(cid:272)(cid:395)(cid:437)(cid:349)(cid:400)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3)(cid:381)(cid:296)(cid:3)
(cid:104)(cid:60)(cid:882)(cid:271)(cid:258)(cid:400)(cid:286)(cid:282)(cid:3)(cid:17)(cid:367)(cid:349)(cid:410)(cid:460)(cid:3)(cid:18)(cid:381)(cid:373)(cid:373)(cid:437)(cid:374)(cid:349)(cid:272)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:856)(cid:3)
(cid:100)(cid:346)(cid:286)(cid:400)(cid:286)(cid:3)(cid:374)(cid:286)(cid:449)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:336)(cid:367)(cid:381)(cid:271)(cid:258)(cid:367)(cid:3)(cid:396)(cid:286)(cid:258)(cid:272)(cid:346)(cid:3)(cid:258)(cid:367)(cid:367)(cid:381)(cid:449)(cid:3)(cid:437)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)
(cid:381)(cid:299)(cid:286)(cid:396)(cid:3)(cid:258)(cid:374)(cid:3)(cid:349)(cid:374)(cid:272)(cid:396)(cid:286)(cid:258)(cid:400)(cid:349)(cid:374)(cid:336)(cid:367)(cid:455)(cid:3)(cid:272)(cid:381)(cid:373)(cid:393)(cid:396)(cid:286)(cid:346)(cid:286)(cid:374)(cid:400)(cid:349)(cid:448)(cid:286)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:272)(cid:381)(cid:374)(cid:448)(cid:286)(cid:374)(cid:349)(cid:286)(cid:374)(cid:410)(cid:3)
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(cid:286)(cid:258)(cid:396)(cid:367)(cid:455)(cid:3)(cid:449)(cid:349)(cid:374)(cid:400)(cid:3)(cid:349)(cid:374)(cid:3)(cid:272)(cid:396)(cid:381)(cid:400)(cid:400)(cid:882)(cid:400)(cid:286)(cid:367)(cid:367)(cid:349)(cid:374)(cid:336)(cid:856)(cid:3)(cid:116)(cid:286)(cid:3)(cid:400)(cid:437)(cid:272)(cid:272)(cid:286)(cid:400)(cid:400)(cid:296)(cid:437)(cid:367)(cid:367)(cid:455)(cid:3)(cid:286)(cid:454)(cid:393)(cid:258)(cid:374)(cid:282)(cid:286)(cid:282)(cid:3)
(cid:410)(cid:346)(cid:286)(cid:3)(cid:400)(cid:272)(cid:381)(cid:393)(cid:286)(cid:3)(cid:381)(cid:296)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:3)(cid:393)(cid:396)(cid:381)(cid:448)(cid:349)(cid:282)(cid:286)(cid:282)(cid:3)(cid:410)(cid:381)(cid:3)(cid:258)(cid:3)(cid:374)(cid:437)(cid:373)(cid:271)(cid:286)(cid:396)(cid:3)(cid:381)(cid:296)(cid:3)(cid:286)(cid:454)(cid:349)(cid:400)(cid:410)-
(cid:349)(cid:374)(cid:336)(cid:3)(cid:272)(cid:367)(cid:349)(cid:286)(cid:374)(cid:410)(cid:400)(cid:853)(cid:3)(cid:349)(cid:374)(cid:272)(cid:367)(cid:437)(cid:282)(cid:349)(cid:374)(cid:336)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:258)(cid:282)(cid:282)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3)(cid:381)(cid:296)(cid:3)(cid:396)(cid:286)(cid:336)(cid:349)(cid:400)(cid:410)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)
(cid:4)(cid:115)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)(cid:104)(cid:17)(cid:68)(cid:3)(cid:28)(cid:68)(cid:28)(cid:4)(cid:859)(cid:400)(cid:3)(cid:104)(cid:60)(cid:882)(cid:271)(cid:258)(cid:400)(cid:286)(cid:282)(cid:3)(cid:286)(cid:448)(cid:286)(cid:374)(cid:410)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)
(cid:258)(cid:282)(cid:282)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3)(cid:381)(cid:296)(cid:3)(cid:4)(cid:115)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:3)(cid:381)(cid:374)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:62)(cid:4)(cid:3)(cid:4)(cid:437)(cid:410)(cid:381)(cid:3)(cid:94)(cid:346)(cid:381)(cid:449)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)
(cid:116)(cid:286)(cid:400)(cid:410)(cid:286)(cid:396)(cid:374)(cid:3) (cid:115)(cid:286)(cid:410)(cid:286)(cid:396)(cid:349)(cid:374)(cid:258)(cid:396)(cid:455)(cid:3) (cid:18)(cid:381)(cid:374)(cid:296)(cid:286)(cid:396)(cid:286)(cid:374)(cid:272)(cid:286)(cid:856)(cid:3) (cid:116)(cid:286)(cid:3) (cid:258)(cid:367)(cid:400)(cid:381)(cid:3) (cid:396)(cid:286)(cid:272)(cid:286)(cid:374)(cid:410)(cid:367)(cid:455)(cid:3)
(cid:449)(cid:381)(cid:374)(cid:3)(cid:258)(cid:3)(cid:374)(cid:286)(cid:449)(cid:3)(cid:336)(cid:367)(cid:381)(cid:271)(cid:258)(cid:367)(cid:3)(cid:258)(cid:336)(cid:396)(cid:286)(cid:286)(cid:373)(cid:286)(cid:374)(cid:410)(cid:3)(cid:449)(cid:349)(cid:410)(cid:346)(cid:3)(cid:100)(cid:258)(cid:396)(cid:400)(cid:437)(cid:400)(cid:856)(cid:3)
(cid:47)(cid:374)(cid:410)(cid:286)(cid:336)(cid:396)(cid:258)(cid:415)(cid:374)(cid:336)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:374)(cid:286)(cid:449)(cid:3) (cid:271)(cid:437)(cid:400)(cid:349)(cid:374)(cid:286)(cid:400)(cid:400)(cid:286)(cid:400)(cid:3) (cid:349)(cid:374)(cid:410)(cid:381)(cid:3) (cid:381)(cid:437)(cid:396)(cid:3) (cid:272)(cid:381)(cid:396)(cid:286)(cid:3) (cid:272)(cid:381)(cid:374)-
(cid:410)(cid:396)(cid:258)(cid:272)(cid:415)(cid:374)(cid:336)(cid:3)(cid:271)(cid:437)(cid:400)(cid:349)(cid:374)(cid:286)(cid:400)(cid:400)(cid:3)(cid:258)(cid:367)(cid:367)(cid:381)(cid:449)(cid:400)(cid:3)(cid:437)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:286)(cid:3)(cid:258)(cid:400)(cid:3)(cid:258)(cid:3)(cid:400)(cid:349)(cid:374)(cid:336)(cid:367)(cid:286)(cid:3)(cid:393)(cid:381)(cid:349)(cid:374)(cid:410)(cid:3)
(cid:381)(cid:296)(cid:3)(cid:272)(cid:381)(cid:374)(cid:410)(cid:258)(cid:272)(cid:410)(cid:3)(cid:296)(cid:381)(cid:396)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:272)(cid:367)(cid:349)(cid:286)(cid:374)(cid:410)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:346)(cid:349)(cid:400)(cid:3)(cid:349)(cid:400)(cid:3)(cid:400)(cid:381)(cid:373)(cid:286)(cid:410)(cid:346)(cid:349)(cid:374)(cid:336)(cid:3)(cid:410)(cid:346)(cid:258)(cid:410)(cid:3)
(cid:374)(cid:381)(cid:374)(cid:286)(cid:3)(cid:381)(cid:296)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:272)(cid:381)(cid:373)(cid:393)(cid:286)(cid:415)(cid:410)(cid:381)(cid:396)(cid:400)(cid:3)(cid:272)(cid:258)(cid:374)(cid:3)(cid:282)(cid:381)(cid:856)(cid:3)(cid:116)(cid:286)(cid:3)(cid:258)(cid:396)(cid:286)(cid:3)(cid:448)(cid:286)(cid:396)(cid:455)(cid:3)(cid:286)(cid:454)(cid:272)(cid:349)(cid:410)(cid:286)(cid:282)(cid:3)
(cid:258)(cid:271)(cid:381)(cid:437)(cid:410)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:393)(cid:381)(cid:400)(cid:400)(cid:349)(cid:271)(cid:349)(cid:367)(cid:349)(cid:415)(cid:286)(cid:400)(cid:3) (cid:258)(cid:346)(cid:286)(cid:258)(cid:282)(cid:3) (cid:258)(cid:400)(cid:3) (cid:410)(cid:346)(cid:286)(cid:400)(cid:286)(cid:3) (cid:258)(cid:272)(cid:395)(cid:437)(cid:349)(cid:400)(cid:349)(cid:415)(cid:381)(cid:374)(cid:400)(cid:3)(cid:3)
(cid:400)(cid:286)(cid:410)(cid:3)(cid:437)(cid:400)(cid:3)(cid:258)(cid:393)(cid:258)(cid:396)(cid:410)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:272)(cid:381)(cid:373)(cid:393)(cid:286)(cid:415)(cid:415)(cid:381)(cid:374)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:282)(cid:286)(cid:367)(cid:349)(cid:448)(cid:286)(cid:396)(cid:3)(cid:400)(cid:410)(cid:396)(cid:381)(cid:374)(cid:336)(cid:3)
(cid:302)(cid:374)(cid:258)(cid:374)(cid:272)(cid:349)(cid:258)(cid:367)(cid:3)(cid:396)(cid:286)(cid:410)(cid:437)(cid:396)(cid:374)(cid:400)(cid:3)(cid:296)(cid:381)(cid:396)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:400)(cid:346)(cid:258)(cid:396)(cid:286)(cid:346)(cid:381)(cid:367)(cid:282)(cid:286)(cid:396)(cid:400)(cid:856)(cid:3)
(cid:100)(cid:90)(cid:4)(cid:115)(cid:28)(cid:62)(cid:3)(cid:920)(cid:3)(cid:90)(cid:28)(cid:18)(cid:90)(cid:28)(cid:4)(cid:100)(cid:47)(cid:75)(cid:69)(cid:3)(cid:39)(cid:90)(cid:75)(cid:104)(cid:87)(cid:3)(cid:44)(cid:47)(cid:39)(cid:44)(cid:62)(cid:47)(cid:39)(cid:44)(cid:100)(cid:94)(cid:855)
(cid:75)(cid:437)(cid:396)(cid:3) (cid:100)(cid:396)(cid:258)(cid:448)(cid:286)(cid:367)(cid:3) (cid:920)(cid:3) (cid:90)(cid:286)(cid:272)(cid:396)(cid:286)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3) (cid:39)(cid:396)(cid:381)(cid:437)(cid:393)(cid:3) (cid:282)(cid:286)(cid:367)(cid:349)(cid:448)(cid:286)(cid:396)(cid:286)(cid:282)(cid:3) (cid:400)(cid:410)(cid:396)(cid:381)(cid:374)(cid:336)(cid:3)
(cid:396)(cid:286)(cid:400)(cid:437)(cid:367)(cid:410)(cid:400)(cid:3) (cid:349)(cid:374)(cid:3) (cid:1006)(cid:1004)(cid:1005)(cid:1008)(cid:3) (cid:449)(cid:349)(cid:410)(cid:346)(cid:3) (cid:396)(cid:286)(cid:448)(cid:286)(cid:374)(cid:437)(cid:286)(cid:3) (cid:336)(cid:396)(cid:381)(cid:449)(cid:410)(cid:346)(cid:3) (cid:381)(cid:296)(cid:3) (cid:1005)(cid:1005)(cid:856)(cid:1005)(cid:3) (cid:393)(cid:286)(cid:396)-
(cid:272)(cid:286)(cid:374)(cid:410)(cid:853)(cid:3) (cid:258)(cid:3) (cid:1006)(cid:1012)(cid:856)(cid:1013)(cid:3) (cid:393)(cid:286)(cid:396)(cid:272)(cid:286)(cid:374)(cid:410)(cid:3) (cid:349)(cid:374)(cid:272)(cid:396)(cid:286)(cid:258)(cid:400)(cid:286)(cid:3) (cid:349)(cid:374)(cid:3) (cid:400)(cid:286)(cid:336)(cid:373)(cid:286)(cid:374)(cid:410)(cid:3) (cid:381)(cid:393)(cid:286)(cid:396)(cid:258)(cid:415)(cid:374)(cid:336)(cid:3)
(cid:349)(cid:374)(cid:272)(cid:381)(cid:373)(cid:286)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:258)(cid:3)(cid:1007)(cid:1006)(cid:1004)(cid:3)(cid:271)(cid:258)(cid:400)(cid:349)(cid:400)(cid:3)(cid:393)(cid:381)(cid:349)(cid:374)(cid:410)(cid:3)(cid:349)(cid:373)(cid:393)(cid:396)(cid:381)(cid:448)(cid:286)(cid:373)(cid:286)(cid:374)(cid:410)(cid:3)(cid:349)(cid:374)(cid:3)(cid:381)(cid:393)(cid:286)(cid:396)(cid:258)(cid:410)-
(cid:349)(cid:374)(cid:336)(cid:3)(cid:373)(cid:258)(cid:396)(cid:336)(cid:349)(cid:374)(cid:856)(cid:3)(cid:116)(cid:286)(cid:3)(cid:286)(cid:454)(cid:393)(cid:286)(cid:396)(cid:349)(cid:286)(cid:374)(cid:272)(cid:286)(cid:282)(cid:3)(cid:336)(cid:396)(cid:286)(cid:258)(cid:410)(cid:286)(cid:396)(cid:3)(cid:448)(cid:349)(cid:400)(cid:349)(cid:410)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3)(cid:410)(cid:381)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)
(cid:258)(cid:425)(cid:396)(cid:258)(cid:272)(cid:415)(cid:381)(cid:374)(cid:400)(cid:853)(cid:3)(cid:349)(cid:374)(cid:272)(cid:396)(cid:286)(cid:258)(cid:400)(cid:286)(cid:282)(cid:3)(cid:90)(cid:286)(cid:448)(cid:87)(cid:4)(cid:90)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:346)(cid:349)(cid:336)(cid:346)(cid:286)(cid:396)(cid:3)(cid:381)(cid:272)(cid:272)(cid:437)(cid:393)(cid:258)(cid:374)(cid:272)(cid:455)(cid:856)(cid:3)
(cid:100)(cid:346)(cid:396)(cid:381)(cid:437)(cid:336)(cid:346)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:90)(cid:286)(cid:296)(cid:396)(cid:286)(cid:400)(cid:346)(cid:882)(cid:17)(cid:437)(cid:349)(cid:367)(cid:282)(cid:882)(cid:17)(cid:437)(cid:455)(cid:3)(cid:336)(cid:396)(cid:381)(cid:449)(cid:410)(cid:346)(cid:3)(cid:349)(cid:374)(cid:349)(cid:415)(cid:258)(cid:415)(cid:448)(cid:286)(cid:400)(cid:853)(cid:3)(cid:449)(cid:286)(cid:3)
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(cid:39)(cid:396)(cid:381)(cid:437)(cid:393)(cid:3) (cid:282)(cid:437)(cid:396)(cid:349)(cid:374)(cid:336)(cid:3) (cid:1006)(cid:1004)(cid:1005)(cid:1008)(cid:3) (cid:449)(cid:349)(cid:410)(cid:346)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:258)(cid:282)(cid:282)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3) (cid:381)(cid:296)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:39)(cid:367)(cid:258)(cid:272)(cid:349)(cid:286)(cid:396)(cid:3)
(cid:94)(cid:364)(cid:455)(cid:449)(cid:258)(cid:367)(cid:364)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:258)(cid:272)(cid:395)(cid:437)(cid:349)(cid:400)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3) (cid:381)(cid:296)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:116)(cid:286)(cid:400)(cid:410)(cid:3) (cid:39)(cid:367)(cid:258)(cid:272)(cid:349)(cid:286)(cid:396)(cid:3)
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(cid:410)(cid:346)(cid:286)(cid:3) (cid:393)(cid:396)(cid:286)(cid:296)(cid:286)(cid:396)(cid:396)(cid:286)(cid:282)(cid:853)(cid:3) (cid:336)(cid:367)(cid:381)(cid:271)(cid:258)(cid:367)(cid:3) (cid:296)(cid:437)(cid:367)(cid:367)(cid:882)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:3) (cid:393)(cid:396)(cid:381)(cid:448)(cid:349)(cid:282)(cid:286)(cid:396)(cid:3) (cid:296)(cid:381)(cid:396)(cid:3) (cid:367)(cid:349)(cid:448)(cid:286)(cid:3)
events.
(cid:116)(cid:286)(cid:3)(cid:396)(cid:286)(cid:373)(cid:258)(cid:349)(cid:374)(cid:3)(cid:296)(cid:381)(cid:272)(cid:437)(cid:400)(cid:286)(cid:282)(cid:3)(cid:381)(cid:374)(cid:3)(cid:282)(cid:396)(cid:349)(cid:448)(cid:349)(cid:374)(cid:336)(cid:3)(cid:286)(cid:312)(cid:272)(cid:349)(cid:286)(cid:374)(cid:272)(cid:349)(cid:286)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:393)(cid:396)(cid:381)(cid:296)-
(cid:349)(cid:410)(cid:258)(cid:271)(cid:367)(cid:286)(cid:3) (cid:410)(cid:381)(cid:393)(cid:882)(cid:367)(cid:349)(cid:374)(cid:286)(cid:3) (cid:336)(cid:396)(cid:381)(cid:449)(cid:410)(cid:346)(cid:853)(cid:3) (cid:400)(cid:437)(cid:272)(cid:272)(cid:286)(cid:400)(cid:400)(cid:296)(cid:437)(cid:367)(cid:367)(cid:455)(cid:3) (cid:349)(cid:374)(cid:410)(cid:286)(cid:336)(cid:396)(cid:258)(cid:415)(cid:374)(cid:336)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3)
(cid:282)(cid:396)(cid:349)(cid:448)(cid:349)(cid:374)(cid:336)(cid:3)(cid:400)(cid:455)(cid:374)(cid:286)(cid:396)(cid:336)(cid:349)(cid:286)(cid:400)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:374)(cid:286)(cid:449)(cid:367)(cid:455)(cid:3)(cid:258)(cid:272)(cid:395)(cid:437)(cid:349)(cid:396)(cid:286)(cid:282)(cid:3)(cid:271)(cid:437)(cid:400)(cid:349)(cid:374)(cid:286)(cid:400)(cid:400)-
(cid:286)(cid:400)(cid:853)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3) (cid:286)(cid:454)(cid:286)(cid:272)(cid:437)(cid:415)(cid:374)(cid:336)(cid:3) (cid:258)(cid:336)(cid:258)(cid:349)(cid:374)(cid:400)(cid:410)(cid:3) (cid:381)(cid:437)(cid:396)(cid:3) (cid:400)(cid:410)(cid:396)(cid:258)(cid:410)(cid:286)(cid:336)(cid:349)(cid:272)(cid:3) (cid:349)(cid:374)(cid:349)(cid:415)(cid:258)(cid:415)(cid:448)(cid:286)(cid:400)(cid:3) (cid:410)(cid:381)(cid:3)
further enhance shareholder value.
(cid:94)(cid:349)(cid:374)(cid:272)(cid:286)(cid:396)(cid:286)(cid:367)(cid:455)(cid:853)
Steve Moster
(cid:87)(cid:396)(cid:286)(cid:400)(cid:349)(cid:282)(cid:286)(cid:374)(cid:410)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:18)(cid:346)(cid:349)(cid:286)(cid:296)(cid:3)(cid:28)(cid:454)(cid:286)(cid:272)(cid:437)(cid:415)(cid:448)(cid:286)(cid:3)(cid:75)(cid:312)(cid:272)(cid:286)(cid:396)
(cid:39)(cid:28)(cid:94)(cid:3)(cid:393)(cid:258)(cid:396)(cid:410)(cid:374)(cid:286)(cid:396)(cid:286)(cid:282)(cid:3)(cid:449)(cid:349)(cid:410)(cid:346)(cid:3)(cid:69)(cid:258)(cid:415)(cid:381)(cid:374)(cid:258)(cid:367)(cid:3)(cid:39)(cid:286)(cid:381)(cid:336)(cid:396)(cid:258)(cid:393)(cid:346)(cid:349)(cid:272)(cid:3)
(cid:410)(cid:381)(cid:3)(cid:272)(cid:396)(cid:286)(cid:258)(cid:410)(cid:286)(cid:3)(cid:258)(cid:3)(cid:437)(cid:374)(cid:349)(cid:395)(cid:437)(cid:286)(cid:3)(cid:346)(cid:258)(cid:374)(cid:282)(cid:400)(cid:882)(cid:381)(cid:374)(cid:3)(cid:286)(cid:282)(cid:437)(cid:272)(cid:258)(cid:415)(cid:381)(cid:374)(cid:258)(cid:367)(cid:3)
(cid:286)(cid:454)(cid:393)(cid:286)(cid:396)(cid:349)(cid:286)(cid:374)(cid:272)(cid:286)(cid:3)(cid:410)(cid:346)(cid:258)(cid:410)(cid:3)(cid:296)(cid:286)(cid:258)(cid:410)(cid:437)(cid:396)(cid:286)(cid:400)(cid:3)(cid:1010)(cid:3)(cid:346)(cid:349)(cid:336)(cid:346)(cid:367)(cid:455)(cid:882)(cid:410)(cid:346)(cid:286)(cid:373)(cid:286)(cid:282)(cid:3)
and immersive environments that allow
(cid:336)(cid:437)(cid:286)(cid:400)(cid:410)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)(cid:296)(cid:381)(cid:367)(cid:367)(cid:381)(cid:449)(cid:3)(cid:349)(cid:374)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:296)(cid:381)(cid:381)(cid:410)(cid:400)(cid:410)(cid:286)(cid:393)(cid:400)(cid:3)(cid:381)(cid:296)(cid:3)(cid:271)(cid:396)(cid:258)(cid:448)(cid:286)(cid:3)
explorers who have risked their lives to
discover new places, help protect them
(cid:296)(cid:381)(cid:396)(cid:3)(cid:296)(cid:437)(cid:410)(cid:437)(cid:396)(cid:286)(cid:3)(cid:336)(cid:286)(cid:374)(cid:286)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:437)(cid:374)(cid:272)(cid:381)(cid:448)(cid:286)(cid:396)(cid:3)(cid:374)(cid:286)(cid:449)(cid:3)
(cid:396)(cid:286)(cid:258)(cid:367)(cid:373)(cid:400)(cid:3)(cid:381)(cid:296)(cid:3)(cid:400)(cid:272)(cid:349)(cid:286)(cid:374)(cid:415)(cid:302)(cid:272)(cid:3)(cid:349)(cid:374)(cid:395)(cid:437)(cid:349)(cid:396)(cid:455)(cid:856)
FINANCIAL HIGHLIGHTS
.
6
6
0
0
1
$
.
3
3
5
9
$
.
0
5
6
0
1
$
.
9
9
5
$
.
9
1
4
$
.
2
8
3
$
9
5
1
$
.
.
5
1
1
$
.
9
9
0
$
%
9
8
2
.
%
2
3
.
%
6
0
.
‘12
‘13
‘14
‘12
‘13
‘14
‘12
‘13
‘14
‘12
‘13
‘14
Revenue1
(in millions)
Segment Operating
Income1
(in millions)
Income Before
Other Items1,2
(per share)
Debt-to-Capital Ratio3
(cid:1005)(cid:3)(cid:1006)(cid:1004)(cid:1005)(cid:1006)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:1006)(cid:1004)(cid:1005)(cid:1007)(cid:3)(cid:396)(cid:286)(cid:400)(cid:437)(cid:367)(cid:410)(cid:400)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:39)(cid:367)(cid:258)(cid:272)(cid:349)(cid:286)(cid:396)(cid:3)(cid:87)(cid:258)(cid:396)(cid:364)(cid:859)(cid:400)(cid:3)(cid:272)(cid:381)(cid:374)(cid:272)(cid:286)(cid:400)(cid:400)(cid:349)(cid:381)(cid:374)(cid:3)(cid:272)(cid:381)(cid:374)(cid:410)(cid:396)(cid:258)(cid:272)(cid:410)(cid:3)(cid:894)(cid:449)(cid:346)(cid:349)(cid:272)(cid:346)(cid:3)(cid:286)(cid:454)(cid:393)(cid:349)(cid:396)(cid:286)(cid:282)(cid:3)(cid:24)(cid:286)(cid:272)(cid:286)(cid:373)(cid:271)(cid:286)(cid:396)(cid:3)(cid:1007)(cid:1005)(cid:853)(cid:3)(cid:1006)(cid:1004)(cid:1005)(cid:1007)(cid:895)(cid:3)(cid:346)(cid:258)(cid:448)(cid:286)(cid:3)(cid:271)(cid:286)(cid:286)(cid:374)(cid:3)(cid:396)(cid:286)(cid:272)(cid:367)(cid:258)(cid:400)(cid:400)(cid:349)(cid:302)(cid:286)(cid:282)(cid:3)(cid:258)(cid:400)(cid:3)(cid:282)(cid:349)(cid:400)(cid:272)(cid:381)(cid:374)(cid:415)(cid:374)(cid:437)(cid:286)(cid:282)(cid:3)(cid:381)(cid:393)(cid:286)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:856)(cid:3)
(cid:1006)(cid:3)(cid:4)(cid:3)(cid:396)(cid:286)(cid:272)(cid:381)(cid:374)(cid:272)(cid:349)(cid:367)(cid:349)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3)(cid:381)(cid:296)(cid:3)(cid:862)(cid:47)(cid:374)(cid:272)(cid:381)(cid:373)(cid:286)(cid:3)(cid:17)(cid:286)(cid:296)(cid:381)(cid:396)(cid:286)(cid:3)(cid:75)(cid:410)(cid:346)(cid:286)(cid:396)(cid:3)(cid:47)(cid:410)(cid:286)(cid:373)(cid:400)(cid:3)(cid:87)(cid:286)(cid:396)(cid:3)(cid:94)(cid:346)(cid:258)(cid:396)(cid:286)(cid:863)(cid:3)(cid:894)(cid:449)(cid:346)(cid:349)(cid:272)(cid:346)(cid:3)(cid:349)(cid:400)(cid:3)(cid:258)(cid:3)(cid:374)(cid:381)(cid:374)(cid:882)(cid:39)(cid:4)(cid:4)(cid:87)(cid:3)(cid:373)(cid:286)(cid:258)(cid:400)(cid:437)(cid:396)(cid:286)(cid:895)(cid:3)(cid:410)(cid:381)(cid:3)(cid:47)(cid:374)(cid:272)(cid:381)(cid:373)(cid:286)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:18)(cid:381)(cid:374)(cid:415)(cid:374)(cid:437)(cid:349)(cid:374)(cid:336)(cid:3)(cid:75)(cid:393)(cid:286)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:3)(cid:87)(cid:286)(cid:396)(cid:3)(cid:94)(cid:346)(cid:258)(cid:396)(cid:286)(cid:3)(cid:296)(cid:381)(cid:367)(cid:367)(cid:381)(cid:449)(cid:400)(cid:855)
(cid:47)(cid:374)(cid:272)(cid:381)(cid:373)(cid:286)(cid:3)(cid:17)(cid:286)(cid:296)(cid:381)(cid:396)(cid:286)(cid:3)(cid:75)(cid:410)(cid:346)(cid:286)(cid:396)(cid:3)(cid:47)(cid:410)(cid:286)(cid:373)(cid:400)
(cid:90)(cid:286)(cid:400)(cid:410)(cid:396)(cid:437)(cid:272)(cid:410)(cid:437)(cid:396)(cid:349)(cid:374)(cid:336)(cid:3)(cid:18)(cid:346)(cid:258)(cid:396)(cid:336)(cid:286)(cid:400)
(cid:47)(cid:373)(cid:393)(cid:258)(cid:349)(cid:396)(cid:373)(cid:286)(cid:374)(cid:410)(cid:3)(cid:18)(cid:346)(cid:258)(cid:396)(cid:336)(cid:286)(cid:400)
(cid:100)(cid:258)(cid:454)(cid:3)(cid:68)(cid:258)(cid:425)(cid:286)(cid:396)(cid:400)
(cid:18)(cid:28)(cid:75)(cid:3)(cid:100)(cid:396)(cid:258)(cid:374)(cid:400)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3)(cid:18)(cid:381)(cid:400)(cid:410)(cid:400)
(cid:47)(cid:374)(cid:272)(cid:381)(cid:373)(cid:286)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:18)(cid:381)(cid:374)(cid:415)(cid:374)(cid:437)(cid:349)(cid:374)(cid:336)(cid:3)(cid:75)(cid:393)(cid:286)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)
(cid:1006)(cid:1004)(cid:1005)(cid:1006)
(cid:936)(cid:1004)(cid:856)(cid:1013)(cid:1013)
(cid:894)(cid:1004)(cid:856)(cid:1005)(cid:1010)(cid:895)
—
(cid:894)(cid:1004)(cid:856)(cid:1010)(cid:1010)(cid:895)
—
(cid:936)(cid:3)(cid:1004)(cid:856)(cid:1005)(cid:1011)
(cid:1006)(cid:1004)(cid:1005)(cid:1007)
(cid:936)(cid:1005)(cid:856)(cid:1005)(cid:1009)
(cid:894)(cid:1004)(cid:856)(cid:1005)(cid:1007)(cid:895)
(cid:894)(cid:1004)(cid:856)(cid:1004)(cid:1012)(cid:895)
(cid:1004)(cid:856)(cid:1004)(cid:1006)
—
(cid:936)(cid:1004)(cid:856)(cid:1013)(cid:1010)
(cid:1006)(cid:1004)(cid:1005)(cid:1008)
(cid:936)(cid:1005)(cid:856)(cid:1009)(cid:1013)
(cid:894)(cid:1004)(cid:856)(cid:1004)(cid:1009)(cid:895)
(cid:894)(cid:1004)(cid:856)(cid:1004)(cid:1007)(cid:895)
(cid:1004)(cid:856)(cid:1009)(cid:1013)
(cid:894)(cid:1004)(cid:856)(cid:1004)(cid:1012)(cid:895)
(cid:936)(cid:1006)(cid:856)(cid:1004)(cid:1006)
(cid:1007)(cid:3)(cid:862)(cid:18)(cid:258)(cid:393)(cid:349)(cid:410)(cid:258)(cid:367)(cid:863)(cid:3)(cid:349)(cid:400)(cid:3)(cid:282)(cid:286)(cid:302)(cid:374)(cid:286)(cid:282)(cid:3)(cid:258)(cid:400)(cid:3)(cid:410)(cid:381)(cid:410)(cid:258)(cid:367)(cid:3)(cid:282)(cid:286)(cid:271)(cid:410)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:272)(cid:258)(cid:393)(cid:349)(cid:410)(cid:258)(cid:367)(cid:3)(cid:367)(cid:286)(cid:258)(cid:400)(cid:286)(cid:3)(cid:381)(cid:271)(cid:367)(cid:349)(cid:336)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:3)(cid:393)(cid:367)(cid:437)(cid:400)(cid:3)(cid:410)(cid:381)(cid:410)(cid:258)(cid:367)(cid:3)(cid:400)(cid:410)(cid:381)(cid:272)(cid:364)(cid:346)(cid:381)(cid:367)(cid:282)(cid:286)(cid:396)(cid:400)(cid:859)(cid:3)(cid:286)(cid:395)(cid:437)(cid:349)(cid:410)(cid:455)(cid:856)
VIAD TEAM VALUES
We believe that living
these values will lead to
SUCCESS and winning at
all we do!
INTEGRITY
TEAM ACHIEVEMENT
(cid:116)(cid:286)(cid:3)(cid:282)(cid:381)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:396)(cid:349)(cid:336)(cid:346)(cid:410)(cid:3)(cid:410)(cid:346)(cid:349)(cid:374)(cid:336)(cid:3)(cid:1005)(cid:1004)(cid:1004)(cid:3)
(cid:393)(cid:286)(cid:396)(cid:272)(cid:286)(cid:374)(cid:410)(cid:3)(cid:381)(cid:296)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:415)(cid:373)(cid:286)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:258)(cid:396)(cid:286)(cid:3)
(cid:272)(cid:381)(cid:373)(cid:373)(cid:349)(cid:425)(cid:286)(cid:282)(cid:3)(cid:410)(cid:381)(cid:3)(cid:271)(cid:286)(cid:349)(cid:374)(cid:336)(cid:3)(cid:862)(cid:4)(cid:367)(cid:449)(cid:258)(cid:455)(cid:400)(cid:3)
Honest.”
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(cid:258)(cid:400)(cid:3)(cid:258)(cid:3)(cid:410)(cid:286)(cid:258)(cid:373)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:410)(cid:381)(cid:3)(cid:282)(cid:286)(cid:367)(cid:349)(cid:448)(cid:286)(cid:396)(cid:349)(cid:374)(cid:336)(cid:3)
(cid:400)(cid:410)(cid:396)(cid:381)(cid:374)(cid:336)(cid:3)(cid:448)(cid:258)(cid:367)(cid:437)(cid:286)(cid:3)(cid:296)(cid:381)(cid:396)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:400)(cid:346)(cid:258)(cid:396)(cid:286)(cid:346)(cid:381)(cid:367)(cid:282)-
(cid:286)(cid:396)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:272)(cid:437)(cid:400)(cid:410)(cid:381)(cid:373)(cid:286)(cid:396)(cid:400)(cid:856)
TRUST & MUTUAL RESPECT
INNOVATION & LEADERSHIP
ENVIRONMENT
We earn and sustain the trust
(cid:381)(cid:296)(cid:3)(cid:381)(cid:410)(cid:346)(cid:286)(cid:396)(cid:400)(cid:3)(cid:410)(cid:346)(cid:396)(cid:381)(cid:437)(cid:336)(cid:346)(cid:3)(cid:396)(cid:286)(cid:400)(cid:393)(cid:286)(cid:272)(cid:410)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)
(cid:258)(cid:272)(cid:272)(cid:381)(cid:437)(cid:374)(cid:410)(cid:258)(cid:271)(cid:349)(cid:367)(cid:349)(cid:410)(cid:455)(cid:856)
(cid:116)(cid:286)(cid:3)(cid:437)(cid:415)(cid:367)(cid:349)(cid:460)(cid:286)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:393)(cid:258)(cid:400)(cid:400)(cid:349)(cid:381)(cid:374)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:272)(cid:396)(cid:286)-
(cid:258)(cid:415)(cid:448)(cid:349)(cid:410)(cid:455)(cid:3)(cid:410)(cid:381)(cid:3)(cid:302)(cid:374)(cid:282)(cid:3)(cid:374)(cid:286)(cid:449)(cid:3)(cid:449)(cid:258)(cid:455)(cid:400)(cid:3)(cid:410)(cid:381)(cid:3)(cid:272)(cid:381)(cid:374)-
(cid:410)(cid:396)(cid:349)(cid:271)(cid:437)(cid:410)(cid:286)(cid:3)(cid:410)(cid:381)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:400)(cid:437)(cid:272)(cid:272)(cid:286)(cid:400)(cid:400)(cid:856)(cid:3)(cid:116)(cid:286)(cid:3)(cid:258)(cid:396)(cid:286)(cid:3)
all leaders. Each one of us is an
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(cid:116)(cid:286)(cid:3)(cid:396)(cid:286)(cid:400)(cid:393)(cid:286)(cid:272)(cid:410)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)(cid:286)(cid:374)(cid:448)(cid:349)(cid:396)(cid:381)(cid:374)(cid:373)(cid:286)(cid:374)(cid:410)(cid:3)
(cid:258)(cid:374)(cid:282)(cid:3)(cid:272)(cid:381)(cid:374)(cid:400)(cid:272)(cid:349)(cid:286)(cid:374)(cid:415)(cid:381)(cid:437)(cid:400)(cid:367)(cid:455)(cid:3)(cid:437)(cid:400)(cid:286)(cid:3)(cid:381)(cid:437)(cid:396)(cid:3)
natural resources.
As filed with the Securities and Exchange Commission on March 12, 2015
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2014
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-11015
Viad Corp
(Exact name of registrant as specified in its charter)
Delaware
State or other jurisdiction of
incorporation or organization
1850 North Central Avenue, Suite 1900
Phoenix, Arizona
(Address of principal executive offices)
36-1169950
(I.R.S. Employer
Identification No.)
85004-4565
(Zip Code)
Registrant’s telephone number, including area code:
(602) 207-1000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Common Stock, $1.50 par value
Name of each exchange
on which registered
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined by Rule 405 of the Securities Act. Yes
No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes
No
Indicate by check mark whether the 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.) Yes
No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in
definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
Indicate by check mark whether registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check One):
Large accelerated filer
Non-accelerated filer
Accelerated filer
Smaller reporting company
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
No
The aggregate market value of the Common Stock (based on its closing price per share on such date) held by non-affiliates on the last business day of the registrant’s most recently
completed second fiscal quarter (June 30, 2014) was approximately $477 million.
Registrant had 20,098,781 shares of Common Stock ($1.50 par value) outstanding as of January 31, 2015.
Documents Incorporated by Reference
A portion of the Proxy Statement for the Annual Meeting of Shareholders of Viad Corp, which is scheduled to be held on May 21, 2015, is incorporated by reference into Part III of this
Annual Report.
INDEX
Part I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.
Other.
Part II
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Part III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Part IV
Item 15.
Business.........................................................................................................................
Risk Factors ...................................................................................................................
Unresolved Staff Comments..........................................................................................
Properties.......................................................................................................................
Legal Proceedings .........................................................................................................
Mine Safety Disclosures................................................................................................
Executive Officers of Registrant ...................................................................................
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities ......................................................................................
Selected Financial Data .................................................................................................
Management’s Discussion and Analysis of Financial Condition and Results of
Operations......................................................................................................................
Quantitative and Qualitative Disclosures About Market Risk ......................................
Financial Statements and Supplementary Data .............................................................
Changes in and Disagreements With Accountants on Accounting and Financial
Disclosure ......................................................................................................................
Controls and Procedures................................................................................................
Other Information..........................................................................................................
Directors, Executive Officers and Corporate Governance ............................................
Executive Compensation ...............................................................................................
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.......................................................................................................
Certain Relationships and Related Transactions, and Director Independence ..............
Principal Accounting Fees and Services........................................................................
Exhibits, Financial Statement Schedules.......................................................................
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Item 1. Business.
PART I
Viad Corp (together with its subsidiaries, “Viad” or the “Company”) derives its revenue from experiential
services provided primarily within the exhibition and events industry and the travel and recreation industry. Viad
occupies leading positions as a value-added service provider in many of the markets in which it competes. Viad
serves clients predominantly in the United States, Canada, the United Kingdom, Germany and the United Arab
Emirates.
Viad operates two business groups:
Marketing & Events Group. The Marketing & Events Group is a global event marketing company that helps
clients gain more awareness, more involvement and more value from their trade show programs and other live
events. The Marketing & Events Group specializes in all aspects of the design, planning and production of face-
to-face events, immersive environments and brand-based experiences for clients, including show organizers,
corporate brand marketers and retail shopping centers. The mission of the Marketing & Events Group is to create
the world’s most meaningful and memorable experiences for show organizers, brand marketers, event attendees
and retail shopping centers. Show organizers include for-profit and not-for-profit show owners as well as show
management companies. Corporate brand marketers include exhibitors and domestic and international corporations
that want to promote their brands, services and innovations, feature new products and build business relationships.
Viad’s retail shopping center customers include major developers, owners and management companies of shopping
malls and lifestyle centers. In 2014, Viad derived approximately 89 percent of its consolidated revenue from
products and services provided by the Marketing & Events Group.
Travel & Recreation Group. The Travel & Recreation Group is an experiential leisure travel provider serving
the needs of regional and long-haul visitors to iconic natural and cultural destinations in North America. The
Travel & Recreation Group generates its revenue from tourism products and experiential services, including the
Glacier Skywalk and other world-class attractions, hotel operations, transportation services and package tour
operations in and around Western Canada, Glacier National Park in Montana, Denali National Park and Preserve
in Alaska and Waterton Lakes National Park in Alberta, Canada. In 2014, Viad derived approximately 11 percent
of its consolidated revenue from services provided by the Travel & Recreation Group.
Viad’s two business groups are supported by the Viad corporate and Shared Services group, which provides
functional support to Viad’s operating units in the areas of management, finance and accounting, internal auditing,
information technology, legal, insurance, corporate development, real estate and tax. The group also handles matters
pertaining to businesses previously discontinued or sold by the Company.
Recent Business Developments
In connection with the Company’s strategic review of opportunities to enhance shareholder value, the
Company paid a special cash dividend of $2.50 per share, or $50.8 million in the aggregate, on November 14,
2013. On February 14, 2014, the Company paid a second special cash dividend of $1.50 per share, or $30.5 million
in the aggregate. In April 2014, the Company concluded its strategic review and announced the Company’s go-
forward strategy to maximize returns on investment for Viad shareholders: accelerate the growth of both business
groups and continue to drive operational efficiencies and margin expansion.
The growth strategy for the Marketing & Events Group, which is comprised of Global Experience Specialists,
Inc. and affiliates (“GES”), is to establish GES as the preferred global, full-service provider for live events, with
further reach to corporate and consumer events, exhibitions, congresses and conferences. The Company expects
to do this through the acquisition of businesses that compete in industry sectors with higher profit margins, add
new, value-added services for GES’ customers that complement and enhance its existing businesses and further
leverage GES’ global capabilities. For the Travel & Recreation Group, the Company continues to execute on its
Refresh-Build-Buy growth strategy, which is focused on refreshing existing assets to drive both rate and volume
1
growth, building new assets and buying assets that add scale to the business and generate strong returns on
investment.
In 2014, the Company completed the following key acquisitions:
• West Glacier Properties: On July 1, 2014, the Company acquired the West Glacier Motel & Cabins, the
Apgar Village Lodge and related land, food and beverage services and retail operations (collectively, the
“West Glacier Properties”). The West Glacier Properties acquisition complements the Travel & Recreation
Group’s existing assets and increases its presence in the Glacier National Park area, reinforcing the
Company’s position as the “Gateway to Glacier”
• Blitz: On September 16, 2014, the Company acquired Blitz Communications Group Limited and affiliates
(collectively, “Blitz”), a leading audio-visual staging and creative services provider for the live events
industry in the United Kingdom and continental Europe. The addition of Blitz has allowed the Marketing
& Events Group to obtain a prominent role in the United Kingdom audio-visual market
onPeak: On October 7, 2014, the Company acquired onPeak LLC and Travel Planners, Inc. By acquiring
these companies, which provide event accommodations services to the majority of the top 100 U.S.
events, the Marketing & Events Group became the leading event accommodations service provider in
the United States
•
• N200: On November 24, 2014, the Company acquired N200 Limited and affiliates (collectively, “N200”),
Europe’s leading event registration and data intelligence services provider for the live events industry.
The acquisition of N200 affords clients of the Marketing & Events Group yet another value-added service
within a high-margin industry sector
In late 2013, the Marketing & Events Group announced the formation of its U.S. in-house audio-visual (“AV”)
team. In 2014, this team produced organic growth for the Marketing & Events Group, servicing 17 events and
growing a solid pipeline for 2015 and beyond. AV services naturally complement the Company’s existing suite of
solutions for live events and enhance the Marketing & Events Group’s ability to provide a more comprehensive
portfolio of service offerings to its customers. The creation of an in-house AV team enables the Company to service
a customer throughout an entire event, from creative and technology to content and design. The addition of Blitz
to the Company’s in-house U.S. services expands the size and geographic reach of the Marketing & Events Group’s
AV operations and creates a stable and integrated platform for growth.
On May 1, 2014, the Company successfully launched the Glacier Skywalk attraction, a fully accessible, cliff-
edge walkway that leads to a glass-floored observation platform 918 feet (280 meters) above the Sunwapta Valley
in close proximity to the Company’s Columbia Icefield attraction in Jasper National Park, Alberta, Canada. During
its first year of operation, the Glacier Skywalk drew nearly 300,000 visitors.
Reportable Segments
Within the two business groups, Viad’s organizational structure, operational decision-making authority,
allocation of resources and internal reporting are aligned into the following reportable business segments:
•
•
•
Marketing & Events U.S. segment;
Marketing & Events International segment; and
Travel & Recreation Group segment.
No reportable segment has a single client comprising more than 6.3 percent of that segment’s revenue, and
no single client comprises more than 4.2 percent of Viad’s revenue. See “The failure of a large client to renew its
services contract or the loss of business from convention facilities could adversely impact revenue” under “Item
1A - Risk Factors” for a discussion of the risks related to Viad’s client relationships which is incorporated herein
by reference.
Viad’s reportable business segments are described below.
2
Marketing & Events U.S. Segment
During 2014, the Marketing & Events U.S. segment (the “U.S. segment”) provided services to over 1,200
exhibitions and events and more than 173,000 exhibitors. The U.S. segment has full-service operations in every
major exhibition market in the United States, including Las Vegas, Nevada; Chicago, Illinois; Orlando, Florida;
New York, New York and Los Angeles, California. In each of these locations, the U.S. segment is a leading event
marketing agency that produces exhibitions, events, exhibits and retail environments, and services some of the
most visible and influential events in its industry. The U.S. segment generates revenue from two lines of business:
exhibition and event services and exhibits and environments. In 2014, U.S. segment exhibition and event services
accounted for 50% of Viad’s consolidated revenue, as compared to 47% and 48% in 2013 and 2012, respectively.
U.S. segment exhibits and environments accounted for 17% of Viad’s consolidated revenue in 2014, as compared
to 18% and 17% in 2013 and 2012, respectively.
Within its two lines of business, the U.S. segment offers the following services:
Show Organizer Services. Under agreements with show organizers, the U.S. segment serves as the official
services contractor of an exhibition, which is also referred to as a “trade show,” “convention” or “show.” As the
official services contractor, the U.S. segment provides the following services to the show organizer: general event
management; planning and consultation; concept design; exhibition layout and design; graphics and design; online
management tools; show traffic analysis; marketing and strategy; carpeting and flooring; signage; decorating
products and accessories; custom graphics; overhead rigging; booth rigging; AV services; temporary electrical,
lighting and plumbing services and cleaning.
Exclusive Services Provided to Exhibitors. As the official services contractor, the U.S. segment is designated
by the show organizer as the exclusive provider of certain services offered to exhibitors participating in the
exhibition. This designation provides exhibitors with a single point of contact to facilitate a timely, safe and efficient
move-in and move-out of the exhibition and to facilitate an organized, professional during-show experience. The
exclusive services offered by the U.S. segment to exhibitors include material handling services; overhead rigging;
AV services; booth rigging; temporary electrical, lighting and plumbing services and cleaning.
Discretionary Services Provided to Exhibitors. In addition to the exclusive services offered to exhibitors,
the U.S. segment competes with other service providers to sell non-exclusive services to exhibitors, including
custom exhibit design and construction; portable and “modular” exhibits and design; integrated marketing,
including pre- and post-event communications; AV and multimedia services; event surveys; return on investment
analysis; attendee and exhibit booth traffic analysis; staff training; online management tools; logistics and freight-
forwarding; storage and refurbishment of exhibits; booth furnishings, carpeting and signage; in-house installation
and dismantling and various other show services. The U.S. segment offers those services, combined with complete
event program management and planning, to corporate brand marketers across all exhibitions and events in which
they participate. The U.S. segment competes with other service providers to offer those discretionary services to
exhibitors, regardless of whether or not the U.S. segment is the official services contractor of the exhibition.
Event Accommodations Services to Show Organizers, Exhibitors and Attendees. On October 7, 2014, the
Company acquired onPeak LLC and Travel Planners, Inc. (collectively, “onPeak”) for a purchase price of $43.0
million and $33.7 million, respectively, in cash, subject to certain adjustments. onPeak is a leading provider of
event accommodations services in North America. Event accommodations services effectively augment the U.S.
segment’s services by offering another important logistical benefit through a single, seamless process. The U.S.
segment acts as the exclusive distributor of accommodations services for a convention, trade show or other live
event, and is responsible for researching and recommending local hotels, securing room blocks, marketing reserved
room blocks to event attendees and exhibitors, managing attendee and exhibitor reservations and addressing any
accommodations concerns during the show. Event accommodations offers the U.S. segment the unique potential
to serve multiple live event participants through a single integrated service network. Event attendees and exhibitors
benefit from the U.S. segment’s accommodations services by receiving convenient and affordable hotel
accommodations, and show organizers benefit from the U.S. segment’s management of complex hotel booking
administration before, during and after the event. The U.S. segment also helps drive revenue per available room
3
(“RevPAR”) for hotels by acting as a direct sales channel to high-value, professional guests. In 2014, onPeak
offered event accommodations services to the majority of the top 100 U.S. events.
Audio-Visual Services to Organizers and Exhibitors. In late 2013, the Marketing & Events Group announced
the formation of a domestic in-house AV team, which produced organic growth and positioned the team as a
potential source of revenue growth for the U.S. segment in 2015 and beyond. Through its AV team, the U.S. segment
offers a variety of AV solutions, including digital design and content, media production, content testing, equipment
rental, staging and creative services. AV services allows customers to use the Company as a single point of contact
throughout a given event and avoid the increased cost associated with outsourced third-party AV service providers.
From a market perspective, the creation of the in-house AV team expanded the scale of the U.S. segment’s service
offerings and reinforced the Company’s position as a leading full-service provider of event services.
Corporate Events. In addition to the exclusive and elective services offered in the context of a tradeshow,
the U.S. segment also offers expertise in corporate event services, which represents a growing market for the
Marketing & Events Group. Corporate events include user week conferences, value-added reseller conferences,
sales meetings and new product or service launches. For corporate event customers, the U.S. segment provides an
array of planning, logistics and production services similar to the services described above and offered in the
context of a tradeshow.
Other Marketing Services. The U.S. segment also provides a variety of immersive, entertaining attractions
and brand-based experiences, sponsored events, mobile marketing and other branded entertainment and face-to-
face marketing solutions for clients and venues, including movie studios, leading consumer brand marketers,
shopping malls and museums. In addition, the U.S. segment offers retail clients complete turnkey services, including
design, engineering, graphic production, fabrication, warehousing, shipping and on-site installation of retail
merchandising units, kiosks and holiday environments. The U.S. segment also provides construction and installation
services for permanent installations, including museum exhibits, corporate lobbies, visitor centers, showrooms and
retail interiors.
Competition. The U.S. segment generally competes in the exhibition and events industry on the basis of
discernible differences, value, quality, price, convenience and service. The primary Viad competitor in the domestic
official services contractor market is The Freeman Company (a private company); however, the U.S. segment
encounters substantial competition from a large number of providers. No competitor has significant market share
in the other categories of offerings of the U.S. segment. All known competitors of the U.S. segment are privately
held companies which provide limited public information concerning their operations.
Marketing & Events International Segment
The Marketing & Events International segment (the “International segment”) includes all foreign operations
of the Marketing & Events Group and consists of two operating segments: Canada and EMEA (Europe, Middle
East and Asia). Like the U.S. segment, the International segment generates its revenue from its exhibition and
event services and exhibits and environments lines of business. In 2014, International segment exhibition and event
services accounted for 17% of Viad’s consolidated revenue, as compared to 18% in each of the previous two years.
International segment exhibits and environments accounted for 7% of Viad’s consolidated revenue in 2014, as
compared to 6% in each of the previous two years. The International segment also offers services that are similar
to those provided by the U.S. segment. Those services are delivered by Viad’s wholly-owned subsidiaries, including
GES Exposition Services (Canada) Limited, Global Experience Specialists (GES) Limited and affiliates, SDD
Exhibitions Limited and GES GmbH & Co. KG.
During 2014, the International segment provided services to nearly 1,000 exhibitions and events and more
than 37,000 exhibitors. The International segment has full-service operations at many of the most active and popular
exhibition and event destinations, including nine Canadian cities, six United Kingdom cities, one German city,
two cities in the United Arab Emirates and three cities in the Netherlands. In each of those locations, the International
segment is a leading service provider, servicing some of the most visible and influential events in its industry. Viad
acquired two companies in 2014 for the International segment that expand the segment’s live event services and
4
further the Company’s growth strategy to transform the Marketing & Events Group into the preferred global full
service provider to live events. On September 16, 2014, the Company acquired Blitz for £15.0 million
(approximately $24.4 million) in cash, subject to certain adjustments. Blitz, located in the United Kingdom, is a
leading AV staging and creative services provider for the live events industry in the United Kingdom and continental
Europe. On November 24, 2014, the Company acquired N200, a premier event registration and data intelligence
services provider for the live events industry in the United Kingdom and the Netherlands, for €9.7 million
(approximately $12.1 million) in cash, subject to certain adjustments, plus an earnout payment of up to €1.0 million.
The amount of the earnout payment is based on N200’s achievement of established financial targets for N200’s
2015 fiscal year.
Competition. The International segment generally competes on the basis of discernible differences, value,
quality, price, convenience and service. The International segment is the largest provider of exhibition and event
services in the countries in which it competes. The International segment encounters competition from a large
number of providers of similar services. Most of the competitors are privately held companies which provide
limited public information concerning their operations.
Travel & Recreation Group Segment
Travel and recreation services are provided by Brewster Inc. (“Brewster”), Glacier Park, Inc. (“Glacier Park”)
and Alaskan Park Properties, Inc. (“Alaska Denali Travel”). Brewster and Alaska Denali Travel are wholly-owned
subsidiaries of Viad, and Glacier Park is an 80 percent owned subsidiary of Viad.
Brewster
Brewster is a major tourism service operator in Western Canada, delivering tourism products that include
world-class hospitality services, attractions, inbound package tour operations and corporate and event management
and transportation services.
Hospitality. Brewster operates three hotels in Alberta: the Mount Royal Hotel and the Banff International
Hotel, both of which are located in the heart of Banff National Park in downtown Banff, Alberta, Canada, and the
Glacier View Inn, which is located on the Columbia Icefield between Lake Louise and Jasper. The hotels cater
principally to leisure travelers.
Attractions. Brewster’s attractions include the Banff Gondola, the Columbia Icefield Glacier Adventure, the
Glacier Skywalk and the Banff Lake Cruise operations. The Banff Gondola transports visitors to an elevation of
over 7,000 feet above sea level to the top of Sulphur Mountain in Banff, Alberta, Canada, offering an unobstructed
view of the Canadian Rockies and overlooking the town of Banff and the Bow Valley. The Columbia Icefield
Glacier Adventure includes tours of the Athabasca Glacier on the Columbia Icefield, and provides customers with
an opportunity to experience one of the largest accumulations of ice and snow south of the Arctic Circle. Icefield
customers ride in an “Ice Explorer,” a unique vehicle specially designed for glacier travel. Brewster also offers
boat tours, small boat rentals and charter fishing on Lake Minnewanka, which is situated outside of the town of
Banff in the heart of the Canadian Rockies. In May 2014, Viad launched the Glacier Skywalk, a 1,312-foot guided
interpretive walkway with a 98-foot glass-floored observation area overlooking the Sunwapta Valley in close
proximity to the Company’s Columbia Icefield attraction in Jasper National Park, Alberta, Canada. Since its
opening, the Glacier Skywalk attraction has experienced robust visitor traffic and received several architectural
and engineering awards for its design.
Package Tour Operations and Corporate and Event Management. Brewster’s inbound package tour
operations offer year-round package tours throughout Canada and typically feature Brewster’s attractions,
transportation services and hotels. In addition to Brewster products, the packages may also include rail, self-drive
automobiles, ski and winter touring, group and individual tours and other tourism products to provide a fulsome
experience that may be custom designed at the time of booking. Brewster also offers a full suite of corporate and
event management services for meetings, conferences, incentive travel, sports and special events. Event-related
5
service offerings include staffing, off-site events, tours/activities, team building, accommodations, event
management, theme development, production and AV services.
Transportation Operations. Brewster’s transportation operations include charter motorcoach services,
sightseeing, scheduled services and airport shuttle service. Brewster operates a modern fleet of luxury
motorcoaches, available for groups of any size, for travel throughout the Canadian provinces of Alberta and British
Columbia. In addition, Brewster provides seasonal half- and full-day sightseeing tours from Calgary, Banff, Lake
Louise and Jasper, Canada.
Brewster draws its customers from major markets, including Canada, the United States, the United Kingdom,
Australia/New Zealand and Asia. Brewster markets directly to consumers, as well as through distribution channels
that include tour operators, tour wholesalers, destination management companies and retail travel agencies and
organizations.
Brewster generated approximately 87 percent of the Travel & Recreation Group’s 2014 segment operating
income.
Glacier Park
Glacier Park is a hotel owner and operator, with properties located in and around Waterton-Glacier
International Peace Park, which encompasses Glacier National Park in Montana, one of the most visited national
parks in the United States, and Waterton Lakes National Park in Alberta, Canada. Glacier Park provides lodging
accommodations, food and beverage services, retail operations and transportation services in and around Glacier
and Waterton Lakes National Parks.
The operations of Glacier Park are predominately seasonal, typically running from late May until the end of
September. During the peak months of July and August, the occupancy level at Glacier Park’s lodges and motor
inns typically exceeds 95 percent. During the “shoulder” months of June and September, occupancy typically
exceeds 70 percent.
Individual travelers account for over 80 percent of Glacier Park’s customers, and the balance of its customers
are tour groups. Demographically, Glacier Park draws over 90 percent of its customers from the United States,
with approximately 40 percent of the U.S. customers coming from the Northwest and Midwest regions.
Historic Lodges and Hotel Accommodations. Glacier Park owns and operates seven properties, with
accommodation offerings varying from hikers’ cabins to hotel suites, including St. Mary Lodge, a 115-room, full-
service resort lodge located outside the east entrance to Glacier National Park in St. Mary, Montana; Glacier Park
Lodge, a historic lodge in East Glacier, Montana; Grouse Mountain Lodge, a full-season lodge offering golf, skiing
in the winter, hiking in the summer and other seasonal recreational activities, located near Glacier National Park
in Whitefish, Montana; the Prince of Wales Hotel in Waterton Lakes National Park, Alberta, Canada, which is
situated on land for which the Company has a 42-year ground lease with the Canadian government running through
January 31, 2052; the West Glacier Motel & Cabins in West Glacier, Montana, and Motel Lake McDonald and the
Apgar Village Lodge, which are located inside Glacier National Park. Glacier Park also operates the food and
beverage services with respect to those properties and the retail shops located near Glacier National Park.
On July 1, 2014, the Company acquired the West Glacier Properties for $16.5 million in cash, with a working
capital adjustment of $0.3 million and subject to certain other adjustments. The West Glacier Motel & Cabins is
a 32-room property situated on approximately 200 acres at the west entrance of Glacier National Park, and its full-
service amenities include a restaurant, grocery store, gift shops, a gas station and employee accommodations. The
Apgar Village Lodge is a 48-room property situated on a 3.8 acre private in-holding inside Glacier National Park
with overnight accommodations, a gift shop and employee accommodations.
6
Alaska Denali Travel
Alaska Denali Travel owns and operates two properties: Denali Backcountry Lodge, a property having 42
guest rooms on six acres inside Denali National Park and Preserve, and Denali Cabins, with 46 guest cabins on
six acres near the entrance to Denali National Park and Preserve. Alaska Denali Travel provides food and beverage
services with respect to those properties, and operates day trips to the Denali Backcountry Lodge via the scenic
park road and a package tours sales and marketing program. Alaska Denali Travel’s operating season runs from
June until the end of September.
Competition. The Travel & Recreation Group generally competes on the basis of location, uniqueness of
facilities, service, quality and price. Competition exists both locally and regionally in the package tour business,
hotel and restaurant business and charter service business.
Intellectual Property
Viad and its subsidiaries own or have the right to use registered trademarks and trademarks pending
registration, used in their businesses, including Global Experience Specialists & design®, GES®, GES Servicenter®,
GES National Servicenter®, GES MarketWorks®, The Art and Science of Engagement®, Trade Show Rigging TSR®,
TSE Trade Show Electrical & design®, Earth Explorers®, Compass Direct®, ethnoMetrics®, eXPRESSO®, FIT®,
eco-sense®, and the trademarks in the 2012 Alaska Denali Travel rebranding program, including Alaska Denali
TravelSM, Alaska Denali Escapes®, Denali Backcountry Adventure®, Denali Backcountry Lodge® and Denali
Cabins®. Viad and its subsidiaries also own or have the right to use many registered trademarks and trademarks
pending registration outside of the United States, including GES®, ShowTech®, Brewster Travel Canada & design®,
Brewster Attractions Explore & design®, Brewster Hospitality Refresh & design®, Glacier Skywalk® and
escape.connect.refresh.explore®. United States trademark registrations are for a term of 10 years and are renewable
every 10 years as long as the trademarks are used in the regular course of business.
The Company owns patents that it believes provide competitive advantages in the marketplace for its exhibit
and exhibition services. Its patented technology relating to a modular structure having a load-bearing surface
provides efficiencies and cost savings in the design, manufacture, assembly, take down and maintenance of displays
and exhibitions. Its patented invention relating to a surface-covering installation tool and method not only reduces
direct labor costs, but provides improved worker safety. The Company also owns a number of design patents for
its retail merchandising units. United States utility patents are currently granted for a term of 20 years from the
date a patent application is filed and United States design patents are currently granted for a term of 14 years from
the date granted. The Marketing & Events Group has extensive design libraries with copyright protections and
owns copyright registrations for a number of the designs within its design libraries. Copyright protection for such
work is 95 years from the date of publication or 120 years from creation, whichever is shorter.
Although Viad believes that certain of its patents, trademarks and copyrights have substantial value, it does
not believe that the loss of any one of those patents, trademarks or copyrights would have a material adverse effect
on its financial condition or results of operations, or the financial condition or results of operations of any of its
reporting segments.
Government Regulation and Compliance
Compliance with legal requirements and government regulations represents a normal cost of doing business.
The principal regulations affecting the day-to-day businesses are rules and regulations relating to transportation
(such as regulations promulgated by the U.S. Department of Transportation and its state counterparts), employees
(such as regulations implemented by the Occupational Safety and Health Administration, equal employment
opportunity laws, guidelines implemented pursuant to the Americans with Disabilities Act and general federal and
state employment laws), unionized labor (such as guidelines imposed by the National Labor Relations Act) and
U.S. and Canadian regulations relating to national parks (such as regulations established by the U.S. Department
of the Interior and the U.S. National Park Service).
7
Some of Viad’s current and former businesses are subject to U.S. federal and state environmental regulations
including laws enacted under the Comprehensive Environmental Response, Compensation and Liability Act, or
its state law counterparts. Compliance with federal, state and local environmental, health and safety provisions,
including, but not limited to, those regulating the discharge of materials into the environment and other actions
relating to the environment, have not had, and are not expected to have, a material effect on Viad’s capital
expenditures, competitive position, financial condition or results of operations. See “Item 1A - Risk Factors -
Liabilities relating to prior and discontinued operations may adversely affect results of operations” for a discussion
of the risks related to liabilities arising from the Company’s compliance with federal, state and local environmental
laws, which is incorporated herein by reference.
Employees
Viad’s businesses had approximately 3,810 employees as of December 31, 2014 as follows:
Marketing & Events Group
Travel & Recreation Group
Viad Corporate and Shared Services Group
Total
Approximate
Number of
Employees
Regular Full-Time
Employees Covered by
Collective Bargaining
Agreements
3,143
529
138
3,810
1,053
98
—
1,151
Viad believes that relations with its employees are satisfactory and that collective-bargaining agreements
expiring in 2015 will be renegotiated in the ordinary course of business without a material adverse effect on Viad’s
operations.
Viad is governed by a Board of Directors comprised of eight non-employee directors and one employee
director, and has an executive management team consisting of six executive officers.
Seasonality
Exhibition and event activity for the U.S. and the International segments varies significantly depending on
the frequency and timing of shows (some shows are not held each year and some may shift between quarters). The
Travel & Recreation Group segment experiences peak activity during the summer months and during 2014, 85
percent of its revenue was earned in the second and third quarters. Viad’s average segment operating income during
the past three years, as a percentage of the average full year’s segment operating income during the past three
years, was approximately 23 percent (first quarter), 26 percent (second quarter), 61 percent (third quarter) and
negative 10 percent (fourth quarter). See “Viad’s businesses are seasonal, which causes results of operations to
fluctuate and makes results of operations particularly sensitive to adverse events during peak periods” and
“Exhibition rotation impacts overall profitability and makes comparisons between periods difficult” under “Item 1A
Risk Factors,” which are incorporated herein by reference; also refer to Note 22, Segment Information and Note
25, Condensed Consolidated Quarterly Results (Unaudited), of Notes to Consolidated Financial Statements.
Financial Information about Restructuring Charges
Information regarding restructuring charges is provided in Note 19, Restructuring Charges, of Notes to
Consolidated Financial Statements.
Financial Information about Segments
Business segment financial information is provided in Note 22, Segment Information, of Notes to
Consolidated Financial Statements.
8
Financial Information about Geographic Areas
Geographic area financial information is provided in Note 22, Segment Information, of Notes to Consolidated
Financial Statements.
Available Information
Viad’s internet address is www.viad.com. Viad uses its web site as a routine channel for distribution of
Company information, press releases, financial information and corporate governance initiatives. Viad posts filings
as soon as reasonably practicable after they are electronically filed with, or furnished to, the U.S. Securities and
Exchange Commission (“SEC”), including Viad’s annual, quarterly and current reports, proxy statements,
amendments to those reports or statements and other information, as well as transactions in Viad securities by
Viad’s directors and executive officers. All such postings and filings are available on Viad’s web site free of charge.
In addition, Viad’s web site allows interested persons to sign up to automatically receive e-mail alerts when the
Company posts news releases and financial information. The SEC’s web site, www.sec.gov, contains reports, proxy
and information statements and other information regarding issuers that file electronically with the SEC. Such
information also can be read and copied at the SEC’s public reference section, located in Room 1580, 100 F Street
N.E., Washington, D.C. 20549. Information regarding the operation of the public reference section can be obtained
by calling (800) SEC-0330. The content on any web site referred to in this Form 10-K is not incorporated by
reference in this Form 10-K unless expressly noted.
Viad’s web site, http://viad.investorroom.com/, includes key information about the Company’s corporate
governance initiatives, including its Corporate Governance Guidelines, charters of the committees of the Board
of Directors, Code of Ethics and information concerning Viad’s directors and a method to communicate with them.
Viad will make available in print any of this information upon request to: Corporate Secretary, Viad Corp, 1850
North Central Avenue, Suite 1900, Phoenix, Arizona 85004-4565.
Item 1A. Risk Factors.
Viad’s operating results are subject to known and unknown risks. As a result, past financial performance and
historical trends may not be reliable indicators of future performance.
Viad’s future payment of special dividends should not be relied upon as a way to realize any future gains on
an investment.
The Board of Directors generally declares and pays regular dividends to Viad’s shareholders on a quarterly
basis and also has paid special dividends, most recently in February 2014. The decision to declare a special dividend
and the amount, timing and payment of any such dividend are at the sole discretion of the Board. Factors in any
decision to declare a dividend would include the amount of funds legally available and an evaluation of the
Company’s financial condition, capital requirements, future prospects and other factors deemed relevant by the
Board. Accordingly, investors should not rely on the future payment of special dividends as a way to realize gains
on their investment.
Viad’s businesses and operating results are adversely affected by deterioration in general economic
conditions.
Viad’s businesses are sensitive to fluctuations in general economic conditions and are impacted by increases
and decreases in the cost of materials and operating supplies. Operating results for the Marketing & Events U.S.
and International segments depend largely on the number of exhibitions held and on the size of exhibitors’ marketing
expenditures, which in turn depend partly on the strength of particular industries in which exhibitors operate. The
number and size of exhibitions generally decrease when the economy weakens.
Further, many exhibitors’ marketing budgets are partly discretionary, and are frequently among the first
expenditures reduced by exhibitors when economic conditions deteriorate, resulting in reduced spending by
exhibitors for the Company’s services. Marketing expenditures often are not increased until economic conditions
9
improve. As a result, during periods of general economic weakness, the operating results for the Marketing &
Events Group are adversely affected. Similarly, many of the retail shopping mall and lifestyle center clients of the
Marketing & Events Group may reduce marketing expenditures when economic conditions deteriorate.
Revenues from the Travel & Recreation Group businesses depend largely on the amount of disposable income
that consumers have available for travel and vacations. This amount decreases during periods of weak general
economic conditions.
Viad’s results of operations are impacted by changes in foreign currency exchange rates.
Viad conducts foreign operations primarily in Canada, the United Kingdom and, to a lesser extent, in certain
other countries. The functional currency of Viad’s foreign subsidiaries is their local currency. Accordingly, for
purposes of consolidation, Viad translates the assets and liabilities of its 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 those foreign denominated assets and liabilities are included as a component of accumulated other
comprehensive income in Viad’s consolidated balance sheets. Significant fluctuations in foreign exchange rates
relative to the U.S. dollar may result in material changes to Viad’s net equity position reported in its consolidated
balance sheets. Viad has not hedged its equity risk arising from the translation of foreign denominated assets and
liabilities.
In addition, for purposes of consolidation, the revenue, expenses and gains and losses related to Viad’s foreign
operations are translated into U.S. dollars at the average foreign exchange rates for the period. As a result, Viad’s
consolidated results of operations are exposed to fluctuations in foreign exchange rates, even when the functional
currency amounts have not changed. Accordingly, fluctuations in the exchange rates affect overall profitability
and historical period-to-period comparisons. Viad has not hedged its net earnings exposure arising from the
translation of its foreign operating results.
During 2014, the Marketing & Events Group derived approximately 26 percent of its revenue and 33 percent
of its segment operating income from its International segment. The Travel & Recreation Group derived
approximately 75 percent of its 2014 revenue and 90 percent of its 2014 segment operating income from its Canadian
operations. For this segment, Canadian operations are largely dependent on foreign customer visitation, and
accordingly, increases in the value of the Canadian dollar as compared to other currencies could adversely affect
customer volumes, and, therefore, revenue and segment operating income in the Travel & Recreation Group.
Exhibition rotation impacts overall profitability and makes comparisons between periods difficult.
The business activities of the Marketing & Events Group are largely dependent upon the frequency, timing
and location of exhibitions and events. Some large exhibitions are not held annually (they may be held once every
two or three years or longer). Some large exhibitions may be held at a different time of year than when they have
historically been held. In addition, the same exhibition may be held in different locations in different years, and
may result in Viad generating lower margins in a given period if the exhibition shifts to a higher-cost city.
As a consequence of those factors, the operating results for those businesses may fluctuate significantly from
quarter to quarter or from year to year, making periodic comparisons difficult.
Viad’s businesses are adversely affected by disruptions in the travel industry, particularly those adversely
affecting the hotel and airline industries.
The success of Viad’s businesses depends largely on the ability and willingness of people, whether exhibitors,
exhibition attendees or others, to travel. Factors adversely affecting the travel industry as a whole, and particularly
the airline and hotel industries, generally also adversely affect Viad’s businesses and results of operations. Factors
that could adversely affect the travel industry as a whole include high or rising fuel prices, increased security and
passport requirements, weather conditions, airline accidents and international political instability and hostilities.
Unexpected events of this nature, or other events that may have an impact on the availability and pricing of air
travel and accommodations, could adversely affect Viad’s businesses and results of operations.
10
The failure of a large client to renew its services contract or the loss of business from convention facilities
could adversely impact revenue.
Although no single client accounted for more than 6.3 percent of the revenue of any of Viad’s reporting segments
in 2014, the Marketing & Events U.S. and International segments have a relatively small number of large exhibition
show organizers and large customer accounts. The loss of any of these large clients could adversely affect Viad’s
results of operations.
In addition, revenue of the Marketing & Events Group may be significantly impacted if certain exhibition
facilities choose to in-source electrical, plumbing or other services. When the Marketing & Events Group is hired
as the official services contractor for an exhibition, the show organizer contractually grants an exclusive right to
perform those electrical and plumbing services, subject in each case to the exhibition facility’s option to in-source
the services (either by performing the services themselves or by hiring a separate service provider). Many exhibition
facilities are under financial pressure as a result of conditions generally affecting their industry, including an
increased supply of exhibition space. As a result, some of those facilities have sought to in-source all or a large
portion of those services. If a large number of facilities with which the Marketing & Events Group has those
relationships moves those services in-house, Viad’s revenue and operating results could be adversely affected.
Viad’s key businesses are relationship driven.
The business activities of the Marketing & Events U.S. and International segments are heavily focused on
client relationships, and, specifically, on the close collaboration and interaction with the client. Those relationships
require the account team to become attuned to the client’s desires and expectations in order to provide top-quality
service. Viad has in the past lost, and may in the future lose, important clients (and corresponding revenue) if a
key member of the account team were to cease employment with the Company and take those customers to a
competitor.
Completed acquisitions may not perform as anticipated or be integrated as planned.
Viad has acquired businesses and intends to continue to pursue opportunities to acquire businesses that
complement, enhance or expand Viad’s current businesses or offer growth opportunities to Viad. Any acquisition
can involve a number of risks, including the failure to achieve the financial and strategic goals and other benefits
from the acquisition; the inability to successfully integrate the acquired business into Viad’s ongoing businesses;
the inability to retain key personnel or customers of the acquired business; the inability to successfully integrate
financial reporting and internal control systems; increased debt; new regulatory requirements; the disruption of
Viad’s ongoing businesses and distraction of senior management and employees of Viad from other opportunities
and challenges due to the integration of the acquired business; and the potential existence of liabilities or
contingencies not disclosed to or known by Viad prior to closing the acquisition or not otherwise provided for
through the purchase agreement. If Viad makes changes to its business strategy or if external conditions adversely
affect its business operations, the Company may also be required to record an impairment charge to goodwill or
intangible assets.
Viad’s businesses are seasonal, which causes results of operations to fluctuate and makes results of operations
particularly sensitive to adverse events during peak periods.
Exhibition and event activity for the U.S. and International segments varies significantly depending on the
frequency and timing of shows, as some shows are not held each year and some may shift between quarters. The
Travel & Recreation Group businesses are generally also seasonal, experiencing peak activity during the second
and third quarters. Those quarters accounted for 85 percent of the segment’s 2014 revenue. Because of the seasonal
nature of Viad’s businesses, adverse events or conditions occurring during peak periods could adversely affect the
operating results of Viad’s businesses.
11
New capital projects may not be commercially successful.
From time to time, in an effort to seize opportunities that complement, enhance and expand its businesses,
Viad pursues new capital projects. Capital projects are subject to a number of risks, including unanticipated delays
and cost overruns, failure to achieve established financial and strategic goals and the inability to successfully
integrate into Viad’s ongoing businesses, as well as additional risks specific to a project. The occurrence of any of
the events described above could prevent a new capital project from performing in accordance with Viad’s
commercial expectations and could have a material adverse effect on its businesses and results of operations.
Transportation disruptions and increases in transportation costs could adversely affect Viad’s businesses
and operating results.
The Marketing & Events U.S. and International segments rely on independent transportation carriers to send
materials and exhibits to and from exhibitions, warehouse facilities and customer facilities. If they were unable to
secure the services of those independent transportation carriers at favorable rates, it could have a material adverse
effect on these businesses and their results of operations. In addition, disruption of transportation services because
of weather-related problems, strikes, lockouts or other events could adversely affect their ability to supply services
to customers and could cause the cancellation of exhibitions, which may have a material adverse effect on its
businesses and operating results. Similarly, disruption of transportation services could adversely affect the ability
of the Marketing & Events Group to supply time-sensitive holiday-themed exhibits and experiences to retail
shopping mall and lifestyle center customers and could cause the cancellation of the exhibits and experiences.
Union-represented labor creates an increased risk of work stoppages and higher labor costs.
A significant portion of Viad’s employees are unionized and Viad’s businesses are party to approximately
100 collective-bargaining agreements, with approximately one-third requiring renegotiation each year. If the results
of labor negotiations caused the Company to increase wages or benefits, which increases total labor costs, the
increased costs could either be absorbed (which would adversely affect operating margins) or passed on to
customers, which may lead customers to turn to other vendors in response to higher prices. In either event, Viad’s
businesses and results of operations could be adversely affected.
Moreover, if the Company were unable to reach an agreement with a union during the collective-bargaining
process, the union may strike or carry out other types of work stoppages. In such a circumstance, Viad might be
unable to find substitute workers with the necessary skills to perform many of the services, or may incur additional
costs to do so, which could adversely affect the Company’s businesses and results of operations.
Obligations to fund multi-employer pension plans to which Viad contributes may have an adverse impact on
operating results.
Viad’s businesses contribute to various multi-employer pension plans based on obligations arising under
collective-bargaining agreements covering its union-represented employees. Viad’s contributions to those multi-
employer plans in 2014 and 2013 totaled $23.2 million and $20.3 million, respectively. Viad does not directly
manage those multi-employer plans, which are generally managed by boards of trustees. Based upon the information
available to Viad from plan administrators, management believes that several of those multi-employer plans are
underfunded. The Pension Protection Act of 2006 requires pension plans underfunded at certain levels to reduce,
over defined time periods, the underfunded status. In addition, under current laws, the termination of a plan, or a
voluntary withdrawal from a plan by Viad, or a shrinking contribution base to a plan as a result of the insolvency
or withdrawal of other contributing employers to such plan, would require Viad to make payments to such plan
for its proportionate share of the plan’s unfunded vested liabilities. Viad cannot determine at this time the amount
of additional funding, if any, it may be required to make to those plans. However, plan contribution increases, if
any, could have an adverse impact on Viad’s consolidated financial condition, results of operations and cash flows.
12
Viad competes in competitive industries and increased competition could negatively impact operating results.
Viad is engaged in a number of highly competitive industries. Competition in the exhibition and events
industry and the exhibits and experiential environments industries is driven by price and service quality, among
other factors. To the extent competitors seek to gain or retain their market presence through aggressive underpricing
strategies, Viad may be required to lower its prices and rates to avoid loss of related business, thereby adversely
affecting operating results. In addition, if Viad is unable to anticipate and respond as effectively as competitors to
changing business conditions, including new technologies and business models, Viad could lose market share to
its competitors. If Viad were unable to meet the challenges presented by the competitive environment, results of
operations could be adversely affected.
Liabilities relating to prior and discontinued operations may adversely affect results of operations.
Viad and its predecessors have a corporate history spanning over eight decades and involving approximately
2,400 previous subsidiaries in diverse businesses, such as the manufacturing of locomotives, buses, industrial
chemicals, fertilizers, pharmaceuticals, leather, textiles, food and fresh meats. Some of those businesses used raw
materials that have been, and may continue to be, the subject of litigation. Moreover, some of the raw materials
used and the waste produced by those businesses have been and are the subject of U.S. federal and state
environmental regulations, including laws enacted under the Comprehensive Environmental Response,
Compensation and Liability Act, or its state law counterparts. In addition, Viad may incur other liabilities, resulting
from indemnification claims involving sold subsidiaries, as well as from past operations of predecessors or their
subsidiaries. Although the Company believes it has adequate reserves and sufficient insurance coverage to cover
those future liabilities, results of operations could be materially affected if future events or proceedings contradict
current assumptions, and reserves or insurance become inadequate.
Terrorist attacks, natural disasters or other catastrophic events may have a negative effect on Viad’s business
The occurrence of catastrophic events ranging from natural disasters (such as hurricanes and floods), health
epidemics or pandemics, acts of war or terrorism, or the prospect of these events could disrupt Viad’s businesses.
Such catastrophic events could impact the Marketing & Events Group’s production facilities, preventing the
Company from timely completing exhibit fabrication and other projects for customers, and also could cause a
cancellation of exhibitions and other events held in public venues or a disruption in the services the Company
provides to its customers at convention centers, exhibition halls, hotels and other public venues. Such catastrophic
events also could adversely impact the Travel & Recreation Group businesses, which are heavily dependent on
the ability and willingness of its guests to travel. The guests serviced by the Travel & Recreation Group tend to
delay or postpone vacations if natural conditions differ from those that typically prevail at competing lodges, resorts
and attractions during a given season, and catastrophic events could impede the guests’ ability to travel, interrupt
the Company’s business operations and/or cause damage to the Company’s properties. If the conditions arising
from such events persist or worsen, Viad could experience continuing or increased adverse effects on its results of
operations and financial condition.
Improper disclosure of personal data could result in liability and harm the Company’s reputation.
Viad’s businesses store and process a significant amount of personally identifiable information in connection
with the services they provide to customers. If the Company’s security controls over personal data, training of
employees and vendors on data security and other practices and procedures do not prevent the improper disclosure
of personally identifiable information, the Company’s reputation could be harmed, and the Company could face
legal exposure to customers and other liabilities under laws that protect personal data, resulting in increased costs
or loss of revenue. Certain of the Company’s services also enable its customers to store and process personal data.
Perceptions that the Company’s services do not adequately protect the privacy of personal information could
adversely affect Viad’s businesses and results of operations.
Item 1B. Unresolved Staff Comments.
None.
13
Item 2. Properties.
Viad’s businesses operate service or production facilities and maintain sales and service offices in the United
States, Canada, the United Kingdom, Germany, the United Arab Emirates and the Netherlands. The principal
properties of Viad are operated by the Marketing & Events Group, the Travel & Recreation Group and Viad
Corporate and Shared Services as follows:
Marketing & Events U.S. Segment. The Marketing & Events U.S. segment operates 19 offices and 24 multi-
use facilities (manufacturing, sales and design, office, storage and/or warehouse and truck marshaling yards). The
multi-use facilities vary in size up to approximately 592,100 square feet. Two of the multi-use facilities are owned;
all other properties are leased.
Marketing & Events International Segment. The Marketing & Events International segment operates 12
offices and 22 multi-use facilities, with three offices and nine multi-use facilities in Canada, four offices and eight
multi-use facilities in the United Kingdom, one office and two multi-use facilities in Germany, one office and three
multi-use facilities in the United Arab Emirates and three offices and one multi-use facility in the Netherlands.
The multi-use facilities vary in size up to approximately 133,600 square feet. All properties are leased.
Travel & Recreation Group Segment. The Travel & Recreation Group segment operates four offices, 20 retail
stores, one bus terminal, five garages, an icefield attraction, an observation platform attraction, a gondola lift
attraction, a boat tour attraction and 12 hotels/lodges (including ancillary food service and recreational facilities).
All of the facilities are in the United States or Canada. The bus terminal, all of the hotels/lodges, one office, four
garages, the icefield attraction, the gondola lift attraction, the observation platform attraction and the boat tour
attraction are owned. One garage and three offices are leased, and three hotels/lodges, an office and all of the
garages and attractions are situated on land subject to multiple long-term ground leases with the Canadian
government.
Viad Headquarters. The Company’s headquarters are leased and approximate 24,700 square feet, and are
located at 1850 North Central Avenue, Suite 1900 in Phoenix, Arizona 85004-4565.
Management believes that the Company’s facilities in the aggregate are adequate and suitable for their
purposes and that capacity is sufficient for current needs.
Item 3. Legal Proceedings.
Viad and certain subsidiaries are plaintiffs or defendants to various actions, proceedings and pending claims,
some of which involve, or may involve, compensatory, punitive or other damages. Litigation is subject to many
uncertainties and it is possible that some of the legal actions, proceedings or claims could be decided against Viad.
Although the amount of liability as of December 31, 2014 with respect to certain of these matters is not ascertainable,
Viad believes that any resulting liability, after taking into consideration amounts already provided for and insurance
coverage, will not have a material effect on Viad’s business, financial condition or results of operations.
Viad is subject to various U.S. federal, state and foreign laws and regulations governing the prevention of
pollution and the protection of the environment in the jurisdictions in which Viad has or had operations. If the
Company has failed to comply with these environmental laws and regulations, civil and criminal penalties could
be imposed and Viad could become subject to regulatory enforcement actions in the form of injunctions and cease
and desist orders. As is the case with many companies, Viad also faces exposure for actual or potential claims and
lawsuits involving environmental matters relating to its past operations. Although it is a party to certain
environmental disputes, Viad believes that any resulting liabilities, after taking into consideration amounts already
provided for and insurance coverage, will not have a material effect on the Company’s financial condition or results
of operations. Refer to “Business - Government Regulation and Compliance” in Item 1; also refer to Note 21,
Litigation, Claims, Contingencies and Other of Notes to Consolidated Financial Statements.
Item 4. Mine Safety Disclosures.
None.
14
Other. Executive Officers of the Registrant.
The names, ages and positions of Viad’s executive officers as of the filing of this Annual Report are listed
below:
Name
Steven W. Moster
Deborah J. DePaoli
Ellen M. Ingersoll
Thomas M.
Kuczynski
Kelly A. Smith
Leslie S. Striedel
Age Business Experience During the Past Five Years and Other Information
45
President and Chief Executive Officer of Viad since December 2014; Group President
of the Marketing & Events Group since May 2011; President of GES, a wholly-owned
subsidiary of Viad, since November 1, 2010; prior thereto, independent consultant
providing marketing and sales consultation services to 3 Day Blinds Corporation, a
manufacturer and retailer of custom window coverings, from April 2010 to August
2010; prior thereto, Executive Vice President-Chief Sales & Marketing Officer of
GES from January 2008 to February 2010; prior thereto, Executive Vice President-
Products and Services of GES from January 2005 to February 2010; prior thereto
Vice President-Products & Services Business of GES from January 2004 to January
2005; and prior thereto, Engagement Manager, Management Strategy Consulting for
McKinsey & Company, a multinational management consulting firm, from August
2000 to January 2004.
50 General Counsel and Secretary since May 2011; prior thereto, Deputy General
Counsel and Assistant Secretary since 2009; prior thereto, Assistant General Counsel
and Assistant Secretary since 2004; prior thereto, held other attorney positions since
joining Viad in 2000; prior thereto, Vice President and General Counsel, Outings on
the Links, Inc. since 1996; and prior thereto, Senior Associate and various legal
positions with Gallagher & Kennedy, P.A. since 1991.
50 Chief Financial Officer since July 2002; prior thereto, Vice President-Controller or
similar position since January 2002; prior thereto, Controller of CashX, Inc., a service
provider of stored value internet cards, from June 2001 through October 2001; prior
thereto, Operations Finance Director of LeapSource, Inc., a provider of business
process outsourcing, since January 2000; and prior thereto, Vice President and
Controller of Franchise Finance Corporation of America since May 1992.
50 Chief Corporate Development & Strategy Officer since March 2008; prior thereto,
Senior Vice President, Corporate Development & Planning of The Nielsen Company,
a media and marketing information company, since August 2006; prior thereto,
Managing Director of The Pareto Group, a provider of strategic and investment
advisory services, since January 2004; and prior thereto, Vice President of Penton
Media, Inc., a business media firm producing magazines, trade shows, conferences
and electronic media, from January 1999 to October 2003.
51 Chief Marketing & Commercial Officer since October 2014; prior thereto, Chief
Marketing Officer of The Pampered Chef, a provider of high quality cookware
through a distributor network of independent consultants, from 2012 to 2014; prior
thereto, Senior Vice President, Corporate Marketing of NAVTEQ Corporation, a
provider of geographic information systems data and electronic navigable maps, from
2008 to 2012; prior thereto, VP, Global Marketing & Communications of NAVTEQ
Corporation from 2003 to 2007; prior thereto, VP, North America Marketing &
Communications of NAVTEQ Corporation from 2001 to 2003; and prior thereto,
various marketing positions at Leo Burnett and DMB&B, multinational advertising
agencies servicing blue-chip clients.
52 Chief Accounting Officer since April 2014; prior thereto, Vice President of Finance
from March 2014 to April 2014; prior thereto, Vice President of Finance and
Administration or similar positions with Colt Defense LLC, a designer, developer
and manufacturer of firearms for military, personal defense and recreational purposes,
from 2010 to 2013; prior thereto, Vice President of Finance, Director of Financial
Reporting and Compliance and Corporate Controller of White Electronics Designs
Corp. (now a subsidiary of Microsemi Corporation), a $100 million public company
manufacturing circuits and semiconductors, from 2004 to 2010; and prior thereto,
Corporate Controller of MD Helicopters, an international helicopter manufacturer,
Corporate Controller of Fluke Networks (formerly Microtest, Inc.), a publicly-traded
manufacturing and technology company, and Senior Tax Manager of KPMG LLP.
The term of office of the executive officers is until the next annual organization meeting of the Board of
Directors of Viad, which is scheduled for May 21, 2015.
15
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities.
The principal market on which Viad’s common stock is traded is the New York Stock Exchange. The common
stock is also admitted for trading on the Chicago and National Exchanges. The following tables summarize the
high and low market prices as reported on the NYSE Euronext Composite Tape and the cash dividends declared
for the two years ended December 31:
SALES PRICE RANGE OF COMMON STOCK
2014
2013
High
Low
High
Low
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
January
February
May
August
October
December
Total
$
$
$
$
28.62
25.52
23.27
27.41
$
$
$
$
23.27
21.95
20.22
19.92
$
$
$
$
28.59
27.71
28.46
28.97
DIVIDENDS DECLARED ON COMMON STOCK
2014
1.50
0.10
0.10
0.10
—
0.10
1.90
$
$
$
$
$
$
$
$
25.26
23.49
21.89
23.91
2013
—
0.10
0.10
0.10
2.50
0.10
2.90
Quarterly dividends were paid on Viad’s common stock on the first business day of January, April, July and
October. In addition on January 24, 2014 and October 25, 2013, Viad announced that its Board of Directors declared
special cash dividends of $1.50 and $2.50 per share, respectively, to shareholders of record at the close of business
on February 7, 2014 and November 7, 2013, respectively. Effective December 2014, the Company entered into an
Amended and Restated Credit Agreement (the “Credit Agreement”). The terms of the Credit Agreement allow
Viad to pay dividends or purchase the Company’s common stock up to $20 million in the aggregate in any calendar
year, with additional dividends, share repurchases or distributions of stock permitted if the Company’s leverage
ratio is less than or equal to 2.00 to 1.00, and the Liquidity Amount (defined as cash in the U.S. and Canada plus
available revolver borrowings on a pro forma basis) is not less than $100 million, and no default or unmatured
default, as defined in the Credit Agreement, exists. For additional information, refer to Note 11, Debt, of Notes to
Consolidated Financial Statements.
As of January 31, 2015, there were a total of 7,114 shareholders of record of Viad’s common stock, including
486 shareholders that had not converted their shares following a stock split effective on July 1, 2004.
For information regarding security ownership of certain beneficial owners and management and related
shareholder matters, refer to Part III, “Item 12, Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters” in this Annual Report.
16
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing, for the five-year period ended December 31, 2014, the yearly
percentage change in the cumulative total shareholder return on Viad’s common stock to the cumulative total return
of the Standard & Poor’s SmallCap 600 Media Index, Standard & Poor’s SmallCap 600 Commercial Services &
Supplies Index, Standard & Poor’s SmallCap 600 Index, Russell 2000 Index and Standard & Poor’s 500 Index.
The graph below assumes $100 was invested on December 31, 2009 in Viad’s common stock, Standard &
Poor’s SmallCap 600 Media Index, Standard & Poor’s SmallCap 600 Commercial Services & Supplies Index,
Standard & Poor’s SmallCap 600 Index, Russell 2000 Index and Standard & Poor’s 500 Index with reinvestment
of all dividends.
Comparison of Five-Year Cumulative Total Return
e
u
l
a
V
x
e
d
n
I
280
240
200
160
120
80
40
0
2009
2010
2011
2012
2013
2014
Period Ending
Viad Corp
Russell 2000
S&P 500
S&P SmallCap 600
S&P 600 Comm. Services & Supplies
S&P 600 Media Index
Viad Corp
S&P 500
Russell 2000
Year Ended December 31,
2009
2010
2011
2012
2013
2014
$ 100.00
$ 124.44
$
86.08
$ 135.55
$ 154.76
$ 160.53
$ 100.00
$ 115.06
$ 117.49
$ 136.27
$ 180.40
$ 205.05
$ 100.00
$ 126.81
$ 121.51
$ 141.40
$ 196.29
$ 205.93
S&P SmallCap 600
$ 100.00
S&P 600 Comm. Services & Supplies $ 100.00
S&P 600 Media Index
$ 100.00
$ 126.29
$ 127.57
$ 148.36
$ 209.65
$ 221.68
$ 116.75
$ 102.09
$ 133.50
$ 191.45
$ 190.14
$ 147.21
$ 113.73
$ 129.33
$ 210.35
$ 246.76
17
Set forth below is a table showing the total number of shares of Viad’s common stock that were repurchased
during the fourth quarter of 2014 by Viad either on the open market as part of a repurchase program or from
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 awards.
ISSUER PURCHASES OF EQUITY SECURITIES
Total Number of
Shares Purchased as
Part of publicly
Announced Plans or
Programs
Maximum Number (or
Approximate Dollar
Value) of Shares that
May Yet Be Purchased
Under the Plans or
Average Price Paid
Per Share ($)
Total Number of
Shares Purchased (#)
1,543
25,518
27,061
Period
November 2014
582,002
December 2014
582,002
Total
582,002
(1) Viad has announced the authorization of its Board of Directors to repurchase shares of the Company’s common
stock from time to time at prevailing market prices. No shares were repurchased on the open market during 2013.
As of December 31, 2014, 582,002 shares remained available for repurchase. The authorization of the Board of
Directors does not have an expiration date. Subsequent to December 31, 2014, the Company repurchased141,462
shares on the open market at a cost of approximately $3.8 million. Refer to Note 26, Subsequent Event, of Notes
to Consolidated Financial Statements.
24.61
25.34
25.30
—
—
—
Programs
(1)
Effective December 2014, the Company entered into an Amended and Restated Credit Agreement (the “Credit
Agreement”). The terms of the Credit Agreement allow Viad to pay dividends or purchase the Company’s common
stock up to $20 million in the aggregate in any calendar year, with additional dividends, share repurchases or
distributions of stock permitted if the Company’s leverage ratio is less than or equal to 2.00 to 1.00, and the
Liquidity Amount (defined as cash in the U.S. and Canada plus available revolver borrowings on a pro forma
basis) is not less than $100 million, and no default or unmatured default, as defined in the Credit Agreement,
exists. For additional information, refer to Note 11, Debt, of Notes to Consolidated Financial Statements.
18
Item 6. Selected Financial Data.
VIAD CORP
SELECTED FINANCIAL AND OTHER DATA
(in thousands, except for per share data)
Statement of Operations Data(1)
Revenues(2):
Year Ended December 31,
2014
2013
2012
2011
2010
Exhibition and event services
$
772,770
$
685,350
$
726,429
$
670,054
$
590,444
Exhibits and environments
Travel and recreation services(3),(4)
Total revenues
Income (loss) from continuing operations(5)
Income from discontinued operations(6)
Net income
Net income attributable to noncontrolling interest
Net income (loss) attributable to Viad
Diluted Income (Loss) per Common Share
Income (loss) from continuing operations attributable
to Viad common stockholders(5)
Income from discontinued operations attributable to
Viad common stockholders(6)
$
$
$
$
Net income attributable to Viad common stockholders
$
Weighted-average outstanding and potentially dilutive
common shares
Basic Income (Loss) per Common Share
Income (loss) from continuing operations attributable
to Viad common stockholders(5)
Income from discontinued operations attributable to
Viad common stockholders(6)
Net income attributable to Viad common stockholders
Weighted-average outstanding common shares
Dividends declared per common share
Balance Sheet Data at Year-End
Total assets
Total debt and capital lease obligations
Total stockholders’ equity
Noncontrolling interest
Other Data
171,698
120,519
1,064,987
41,178
14,389
55,567
(3,213)
$
$
$
$
159,554
108,443
953,347
19,320
2,366
21,686
(131)
175,611
104,604
1,006,644
3,553
3,030
6,583
(686)
$
$
$
$
170,496
87,219
927,769
7,544
2,199
9,743
(533)
52,354
$
21,555
$
5,897
$
9,210
$
166,040
70,014
826,498
(1,637)
2,716
1,079
(636)
443
2.02
$
0.96
$
0.17
$
0.36
$
(0.09)
0.57
2.59
$
0.10
1.06
$
0.12
0.29
$
0.09
0.45
$
0.11
0.02
20,133
20,265
20,005
20,055
20,277
$
$
$
$
2.02
$
0.96
$
0.17
$
0.36
$
(0.09)
$
$
$
0.57
2.59
19,804
1.90
714,943
141,020
347,702
12,315
$
$
$
0.10
1.06
19,850
2.90
561,932
11,668
356,543
9,102
$
$
$
0.12
0.29
19,701
0.28
650,577
2,226
397,032
8,971
$
$
$
0.09
0.45
19,719
0.16
617,828
3,239
386,179
8,285
0.11
0.02
19,955
0.16
616,503
9,077
386,711
7,752
Adjusted EBITDA(7)
28,372
(1) 2013 and prior years have been adjusted for discontinued operations associated with the expiration of the Glacier
53,971
40,527
73,954
59,157
$
$
$
$
$
Park concession contract on December 31, 2013.
(2) 2014 amounts include an aggregate $21.2 million in revenue from the following acquisitions that occurred
throughout 2014: West Glacier Properties, Blitz, onPeak and N200. Refer to Note 3, Acquisition of Businesses,
of Notes to Consolidated Financial Statements.
(3) 2012 amounts include $5.2 million in revenue from the Banff International Hotel which was acquired in March
2012.
(4) 2011 amounts include an aggregate $9.7 million in revenue from Grouse Mountain Lodge, St. Mary Lodge,
Denali Backcountry Lodge and Denali Cabins which were acquired in 2011.
19
(5) Income from continuing operations includes the following items:
•
• Restructuring charges, net of tax, of $1.0 million, $2.6 million, $3.3 million, $2.5 million and $2.6 million
in 2014, 2013, 2012, 2011, and 2010, respectively. Refer to Note 19, Restructuring Charges, of Notes to
Consolidated Financial Statements.
Impairment charges, net of tax, of $0.5 million, $1.6 million and $0.3 million in 2014, 2013, and 2010,
respectively. Refer to Note 6, Property and Equipment and Note 8, Goodwill and Other Intangible Assets,
of Notes to Consolidated Financial Statements.
Income tax expense in 2014 included a release of $11.7 million of the valuation allowance related to our
foreign tax credit and state NOL carryforwards. Refer to Note 17, Income Taxes, of Notes to Consolidated
Financial Statements.
Income tax expense in 2012 included a $13.4 million valuation allowance for certain deferred assets
associated with foreign tax credit carryforwards. Refer to Note 17, Income Taxes, of Notes to Consolidated
Financial Statements.
•
•
(6) The amounts primarily relate to the gain on the possessory interest and personal property proceeds from the
expiration of the Glacier Park concession contract in 2014, the sale of land in 2013 and 2012 associated with
previously sold operations and the operations related to the Glacier Park concession contract and obligations
associated with previously sold operations for 2010-2013. Refer to Note 24, Discontinued Operations, of Notes
to Consolidated Financial Statements.
(7) See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a
discussion of “Non-GAAP Measure.”
20
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with Viad Corp’s consolidated financial statements
and related notes. This discussion contains forward-looking statements that involve risks and uncertainties. Viad
Corp’s actual results could differ materially from those anticipated due to various factors discussed under “Risk
Factors,” “Forward-Looking Statements” and elsewhere in this Annual Report.
Overview
Viad Corp (“Viad” or the “Company”) operates in three reportable business segments: Marketing & Events
U.S., Marketing & Events International and Travel & Recreation Group.
The Marketing & Events Group, comprised of Global Experience Specialists, Inc. and affiliates (“GES”),
is a global event marketing company that helps clients gain more awareness, more involvement and more value
from their trade show programs and other live events. The Marketing & Events Group specializes in all aspects of
the design, planning and production of face-to-face events, immersive environments and brand-based experiences
for clients, including show organizers, corporate brand marketers and retail shopping centers. The mission of the
Marketing & Events Group is to create the world’s most meaningful and memorable experiences for show
organizers, brand marketers, event attendees and retail shopping centers. Show organizers include for-profit and
not-for-profit show owners as well as show management companies. Corporate brand marketers include exhibitors
and domestic and international corporations that want to promote their brands, services and innovations, feature
new products and build business relationships. Viad’s retail shopping center customers include major developers,
owners and management companies of shopping malls and leisure centers.
On September 16, 2014, the Company acquired Blitz Communications Group Limited and affiliates
(collectively, “Blitz”), which has offices in the United Kingdom and is a leading audio-visual staging and creative
services provider for the live events industry in the United Kingdom and continental Europe. The purchase price
was £15.0 million (approximately $24.4 million) in cash, subject to certain adjustments.
On October 7, 2014, the Company acquired onPeak LLC and Travel Planners, Inc. (collectively, “onPeak”)
for a purchase price of $43.0 million and $33.7 million, respectively, in cash, subject to certain adjustments. Both
acquired companies provide event accommodations services in North America to the live events industry.
On November 24, 2014, the Company acquired N200 Limited and affiliates (collectively, “N200”) for €9.7
million (approximately $12.1 million) in cash, subject to certain adjustments, plus an earnout payment (the
“Earnout”) of up to €1.0 million. The amount of the Earnout is based on N200’s achievement of established financial
targets for fiscal 2015 (ending June 30). N200, which has offices in the United Kingdom and the Netherlands, is
a leading event registration and data intelligence services provider for the live events industry in the United Kingdom
and the Netherlands.
The Travel & Recreation Group is an experiential leisure travel provider serving the needs of regional and
long-haul visitors to iconic natural and cultural destinations in North America. The Travel & Recreation Group
segment consists of Brewster Inc. (“Brewster”), Glacier Park, Inc. (“Glacier Park”) and Alaskan Park Properties,
Inc. (“Alaska Denali Travel”). Brewster provides tourism products and experiential services in the Canadian
Rockies in Alberta and in other parts of Western Canada. Brewster’s operations include the Banff Gondola,
Columbia Icefield Glacier Adventure, Glacier Skywalk (opened May 2014), Banff Lake Cruise, motorcoach
services, charter and sightseeing services, inbound package tour operations and hotel operations.
During 2014, Glacier Park owned and operated seven properties, with accommodation offerings varying
from hikers’ cabins to hotel suites, including St. Mary Lodge, a 115-room, full-service resort lodge located outside
the east entrance to Glacier National Park in St. Mary, Montana; Glacier Park Lodge, a historic lodge in East
Glacier, Montana; Grouse Mountain Lodge, a full-season lodge offering golf, skiing in the winter, hiking in the
summer and other seasonal recreational activities, located near Glacier National Park in Whitefish, Montana; the
Prince of Wales Hotel in Waterton Lakes National Park, Alberta, Canada, which is situated on land for which the
Company has a 42-year ground lease with the Canadian government running through January 31, 2052; the West
21
Glacier Motel & Cabins in West Glacier, Montana, and Motel Lake McDonald and the Apgar Village Lodge, which
are located inside Glacier National Park. Glacier Park also operates the food and beverage services with respect
to those properties and the retail shops located near Glacier National Park. With regard to Glacier Park’s concession
operations within Glacier National Park, refer to Note 24, Discontinued Operations, of Notes to Consolidated
Financial Statements.
On July 1, 2014, the Company acquired the West Glacier Motel & Cabins, the Apgar Village Lodge and
related land, food and beverage services and retail operations (collectively, the “West Glacier Properties”). The
West Glacier Motel & Cabins is a 32-room property situated on approximately 200 acres at the west entrance of
Glacier National Park, and its full-service amenities include a restaurant, grocery store, gift shops, a gas station
and employee accommodations. The Apgar Village Lodge is a 48-room property situated on a 3.8 acre private in-
holding inside Glacier National Park with overnight accommodations, a gift shop and employee accommodations.
The purchase price was $16.5 million in cash with a working capital adjustment of $0.3 million, subject to certain
adjustments. For additional information, refer to Note 3, Acquisition of Businesses, of Notes to Consolidated
Financial Statements.
Alaska Denali Travel operates the Denali Backcountry Lodge and Denali Cabins. In addition to lodging,
Alaska Denali Travel also provides food and beverage operations and package tour and transportation services in
and around Denali National Park and Preserve.
Financial Highlights
The following 2014 financial highlights are presented in accordance with accounting principles generally
accepted in the United States of America (“GAAP”):
Viad Corp (Consolidated)
•
•
•
•
•
•
•
Total revenues of $1.1 billion, an increase of 11.7 percent from 2013 revenues
Net income attributable to Viad of $52.4 million, as compared to $21.6 million in 2013
Diluted income per share of $2.59, as compared to $1.06 in 2013
Restructuring charges totaling $1.6 million primarily related to the elimination of certain positions
in the Marketing & Events Group, partially offset by recoveries related to updated estimates of
facility contractual arrangements
Income from discontinued operations of $14.4 million primarily related to the gain on the possessory
interest and personal property at Glacier Park
Cash and cash equivalents were $57.0 million as of December 31, 2014
Debt was $141.0 million as of December 31, 2014
Marketing & Events U.S.
•
•
Revenues of $710.8 million, an increase of 13.0 percent from 2013 revenues
Segment operating income of $21.4 million, as compared to $11.0 million in 2013
Marketing & Events International
•
•
Revenues of $249.6 million, an increase of 8.9 percent from 2013 revenues
Segment operating income of $10.3 million, as compared to $9.1 million in 2013
Travel & Recreation Group
•
•
Revenues of $120.5 million, an increase of 11.1 percent from 2013 revenues
Segment operating income of $28.1 million, as compared to $21.8 million in 2013
22
Non-GAAP Measure:
The following discussion includes a presentation of Adjusted EBITDA, which is utilized by management to
measure the profit and performance of Viad’s operations and to facilitate period-to-period comparisons. “Adjusted
EBITDA” is defined by Viad as net income attributable to Viad before interest expense, income taxes, depreciation
and amortization, impairment charges and recoveries, changes in accounting principles and the effects of
discontinued operations. The presentation of Adjusted EBITDA is supplemental to results presented under GAAP
and may not be comparable to similarly titled measures used by other companies. Adjusted EBITDA is considered
a useful operating metric as potential variations arising from taxes, depreciation, debt service costs, impairment
charges and recoveries, changes in accounting principles and the effects of discontinued operations are eliminated,
thus resulting in an additional measure considered to be indicative of Viad’s ongoing operations. This non-GAAP
measure should be considered in addition to, but not as a substitute for, other measures of financial performance
reported in accordance with GAAP.
Management believes that the presentation of Adjusted EBITDA provides useful information to investors
regarding Viad’s results of operations for trending, analyzing and benchmarking the performance and value of
Viad’s business. Management uses Adjusted EBITDA primarily as a performance measure and believes that the
GAAP financial measure most directly comparable to this non-GAAP measure is net income attributable to Viad.
Although Adjusted EBITDA is used as a financial measure to assess the performance of the business, the use of
Adjusted EBITDA is limited because it does not consider material costs, expenses and other items necessary to
operate the 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 income taxes, impairment
charges or recoveries, and the effects of accounting changes and discontinued operations. Because Adjusted
EBITDA does not consider the above items, a user of Viad’s financial information should consider net income
attributable to Viad as an important measure of financial performance because it provides a more complete measure
of the Company’s performance.
A reconciliation of net income attributable to Viad to Adjusted EBITDA is as follows:
(in thousands)
Net income attributable to Viad
Depreciation and amortization
Interest expense
Income tax expense (benefit)
Impairment charges
Income from discontinued operations
Adjusted EBITDA
2014
2013
2012
$
$
52,354
30,382
2,137
(239)
884
(11,564)
73,954
$
$
21,555
27,634
1,250
8,206
2,630
(2,118)
59,157
$
$
5,897
29,843
1,345
19,435
—
(2,549)
53,971
The increase in Adjusted EBITDA of $14.8 million from 2013 to 2014 was primarily due to higher segment
operating income at both the Marketing & Events Group and Travel & Recreation Group and lower restructuring
charges, partially offset by higher corporate costs. The increase in Adjusted EBITDA of $5.2 million from 2012
to 2013 was primarily due to higher segment operating results at the Travel & Recreation Group, as well as lower
corporate costs and restructuring charges. See “Results of Operations” below for a discussion of fluctuations.
23
Results of Operations:
2014 vs. 2013:
The following are consolidated highlights:
• Total revenue was $1.1 billion, as compared to $953.3 million in 2013. The increase in revenue was
primarily driven by positive show rotation, continued same-show growth, and the acquisitions of onPeak,
Blitz and N200 in the Marketing & Events Group U.S. and International segments. The increase in the
Travel & Recreation Group revenue was primarily due to Brewster’s attractions, with the Glacier Skywalk
(opened May 2014) driving growth at our attractions and the acquisition of the West Glacier Properties.
• Total segment operating income was $59.9 million, as compared to $41.9 million in 2013. The increase
in segment operating income was primarily driven by higher revenue and increased margins in all three
reportable segments.
• Diluted income per share from continuing operations attributable to Viad shareholders was $2.02, as
•
compared to $0.96 in 2013.
Income from discontinued operations attributable to Viad was $11.6 million, as compared to income
of $2.1 million in 2013, primarily related to the expiration of Glacier Park’s concession contract with
the Park Service on December 31, 2013. The Company’s 2013 results related to the operations of Glacier
Park’s concession contract business have been reclassified as discontinued operations.
• Net income attributable to Viad was $52.4 million, as compared to $21.6 million in 2013.
Foreign Exchange Rate Variances
Viad conducts its foreign operations primarily in Canada, the United Kingdom, Germany and to a lesser
extent in certain other countries.
During 2014, foreign exchange rate variances resulted in decreases in revenue and segment operating income
of $0.3 million and $0.6 million, respectively, as compared to 2013. The following table summarizes the effects
of foreign exchange rate variances on year over year revenue and segment operating results from Viad’s international
operations, excluding the effect of 2014 acquisitions:
Marketing & Events Group:
Canada
United Kingdom
Germany
Travel & Recreation Group:
Canada
$
$
$
$
Revenues
Segment Operating Results
Weighted-Average
Exchange Rates
2014
2013
Effect of Rate
Variance
(in thousands)
Weighted-Average
Exchange Rates
2014
2013
Effect of Rate
Variance
(in thousands)
0.90
1.65
1.32
$
$
$
0.97
1.56
1.33
0.92
$
0.96
$
$
$
$
$
$
(4,635) $
$
9,105
(58) $
4,412
(4,735) $
(323)
0.88
1.66
1.35
$
$
$
0.99
1.57
1.33
0.93
$
0.96
$
$
$
$
$
$
(211)
460
2
251
(877)
(626)
Viad’s results were primarily impacted by the weakening of the Canadian dollar and the strengthening of the British
pound relative to the U.S. dollar. Future changes in the exchange rates may impact overall expected profitability
and historical period-to-period comparisons when operating results are translated into U.S. dollars.
24
Analysis of Operating Results by Reportable Segment
(in thousands)
Revenue:
Marketing & Events Group:
U.S.
International
Intersegment eliminations
Total Marketing & Events Group
Travel & Recreation Group
Total revenue
Segment operating income:
Marketing & Events Group:
U.S.
International
Total Marketing & Events Group
Travel & Recreation Group
Segment operating income
Marketing & Events Group
Year Ended December 31,
2014
2013
Change
$
$
$
$
710,835
249,649
(16,016)
944,468
120,519
1,064,987
21,400
10,339
31,739
28,127
59,866
$
$
$
$
628,856
229,312
(13,264)
844,904
108,443
953,347
11,024
9,068
20,092
21,819
41,911
$
$
$
$
81,979
20,337
(2,752)
99,564
12,076
111,640
10,376
1,271
11,647
6,308
17,955
13.0%
8.9%
20.7%
11.8%
11.1%
11.7%
94.1%
14.0%
58.0%
28.9%
42.8%
Seasonality. Exhibition and event activity can vary significantly from quarter to quarter and year to year,
depending on the frequency and timing of shows (some shows are not held each year and some may shift between
quarters). The rotation metric helps explain the show movement between quarters and years. 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.
U.S. Segment. Revenue for the Marketing & Events U.S. segment was $710.8 million in 2014, up 13.0
percent, as compared to $628.9 million in 2013. Segment operating income increased $10.4 million to $21.4 million,
as compared to 2013. Organic increases, excluding the acquisition of onPeak, were $75.9 million in revenue and
$10.6 million in operating income. Revenue was primarily impacted by positive show rotation revenue of
approximately $69 million, base same-show revenue growth of 6.4 percent, and higher revenue from corporate
clients, partially offset by the loss of the International Consumer Electronics Show. Management defines base
same-show revenue as revenue derived from shows that the Company produced out of the same city during the
same quarter in each year. Base same-shows represented 39 percent of Marketing & Events U.S. segment revenue
in 2014. Operating income was also affected by a non-recurring gain of $4.8 million in 2013 related to the sale of
a facility as well as higher performance-based incentives in 2014.
International Segment. Revenue for the Marketing & Events International segment in 2014 was affected
by exchange rate variances, which had a favorable impact on revenue and segment operating income of $4.4 million
and $0.3 million, respectively, as compared to 2013. Excluding exchange rate variances, revenue increased by
$15.9 million, or 6.9 percent, and segment operating results increased by $1.0 million, or 11.2 percent. Organic
growth, excluding the acquisitions of Blitz and N200 as well as the impact of exchange rate variances, was $5.3
million in revenue and $0.8 million in operating income. These increases were primarily driven by new business
wins, partially offset by negative show rotation revenue of approximately $4 million.
2015 Outlook. Although the Marketing & Events Group 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.
25
For the 2015 full year, management expects U.S. base same-show revenue to increase at a mid-single digit
rate and show rotation to have a net negative impact on revenue of approximately $75 million versus 2014.
Additionally, management anticipates that foreign currency exchange rate variances versus 2014 will have an
unfavorable impact on the Marketing & Events Group’s 2015 full year revenue and operating income of
approximately $25 million and $1 million, respectively.
Management remains focused on improving the profitability of the Marketing & Events U.S. segment 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.
Additionally, management is executing a strategic growth plan to transform the Marketing & Events Group
into the preferred global full service provider to the live events market, which includes adding complementary and
higher-margin service lines to its existing official services contracting business. In connection with this plan, the
Company completed the following key acquisitions during 2014:
• Blitz, a leading audio-visual staging and creative services provider for the live events industry in
Europe. The addition of Blitz, effective September 16, 2014, provided international scale to the
Marketing & Events Group’s existing U.S. in-house audio-visual operations that were launched in
late 2013.
onPeak, which provides event accommodations services to approximately 60 percent of the top 250
U.S. events. Upon acquiring these companies, effective October 7, 2014, the Marketing & Events
Group became the leading event accommodations service provider in the United States.
•
• N200, Europe’s leading event registration and data intelligence service provider for the live events
industry. This acquisition, effective November 24, 2014, affords clients yet another value-added
service and adds another high-margin business to the Marketing & Events Group.
Collectively, the acquisitions of Blitz, onPeak and N200 contributed revenue and segment EBITDA of $16.7
million and $2.5 million, respectively, to the Marketing & Events Group’s 2014 results. Segment EBITDA is
defined as segment operating income plus depreciation and amortization expense. In 2015, management expects
these acquisitions to collectively provide revenue of about $62 million to $67 million and segment EBITDA of
about $14.5 million to $15.5 million. These acquisitions offer cross-selling opportunities across the Marketing &
Events Group’s customer base, which is resulting in expanded business relationships with existing customers and
creating new competitive advantages for the Marketing & Events Group as it increasingly becomes a full-service
provider for live events.
Travel & Recreation Group
Seasonality. The Travel & Recreation Group segment experiences peak activity during the summer months.
During 2014, 85 percent of its revenue was earned in the second and third quarters.
Results for the Travel & Recreation Group segment for 2014 were affected by exchange rate variances, which
had an unfavorable impact on revenue and segment operating income of $4.7 million and $0.9 million, respectively,
as compared to 2013. Excluding exchange rate variances, revenue increased by $16.8 million, or 15.5 percent, and
segment operating income increased by $7.2 million, or 32.9 percent.
26
The following table provides Travel & Recreation Group revenue by line of business:
(in thousands)
Revenues:
Hospitality
Attractions
Package tours
Transportation
Intra-segment eliminations & other
Year Ended December 31,
2014
2013
Change
$
42,689
$
38,236
$
44,691
19,336
15,954
(2,151)
36,102
18,950
17,247
(2,092)
108,443
$
4,453
8,589
386
(1,293)
(59)
12,076
11.6 %
23.8 %
2.0 %
(7.5)%
2.8 %
11.1 %
Total
$
120,519
$
Revenue. The increases in revenue in 2014 were primarily driven by attractions and hospitality. The improved
results from attractions were primarily due to the opening of the new Glacier Skywalk attraction and increased
passenger counts at the Columbia Icefield Glacier Adventure, the Banff Gondola, and the Banff Lake Cruise.
Hospitality revenue increased primarily due to the acquisition of the West Glacier Properties on July 1, 2014, which
added $4.6 million of revenue. Excluding the West Glacier Properties, hospitality revenue decreased slightly versus
the comparable periods in 2013 primarily due to declines at the Denali Backcountry Lodge and Glacier Park Lodge.
The Denali Backcountry Lodge was negatively affected by flooding at the end of June 2014 and Glacier Park
Lodge experienced especially strong occupancy in 2013 as a result of its centennial anniversary. Declines at these
properties were partially offset by increases at the Banff International Hotel, the Mount Royal Hotel and the Glacier
View Inn, which benefitted from strong visitation to Banff and Jasper National Parks, as well as Grouse Mountain
Lodge driven by the Company’s renovations in 2012 and 2013.
Transportation revenue decreased as compared to the prior year primarily as a result of unfavorable foreign
exchange rate variances and reduced business for the Denali Backcountry Adventure. Package tours revenue
increased primarily due to higher group and individual business, partially offset by unfavorable exchange rate
variances.
Performance Measures. Management uses the following key business metrics to evaluate the Travel &
Recreation Group hospitality business: revenue per available room (“RevPAR”), average daily rate (“ADR”) and
occupancy. These metrics are commonly used in the hospitality industry to measure performance.
Revenue per Available Room. RevPAR is calculated as total rooms revenue divided by the total number of
room nights available for all comparable Travel & Recreation Group 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 for comparable hospitality properties. RevPAR is affected by average daily rate and occupancy,
which have different implications on profitability.
Average Daily Rate. ADR is calculated as total rooms revenue divided by the total number of room nights
sold for all comparable Travel & Recreation Group hospitality properties during the period. ADR is used to assess
the pricing levels that the hospitality properties are able to generate. 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 Travel & Recreation Group 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 ancillary non-rooms revenue (including food and beverage
and retail revenue).
27
Management evaluates the performance of the Travel & Recreation Group 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 Travel & Recreation Group
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 Travel & Recreation Group same-store key performance indicators for the
twelve months ended December 31, 2014 and 2013. The same-store metrics below indicate the performance of all
Travel & Recreation Group properties and attractions that were owned by Viad and operating at full capacity,
considering seasonal closures, for the entirety of both periods presented. For Travel & Recreation Group properties
and attractions located in Canada, comparisons to the prior year are on a constant U.S. dollar basis, using the current
year quarterly average exchange rates for previous periods, to eliminate the positive or negative effects that result
from translating. Management believes that this same-store constant currency basis provides better comparability
between reporting periods. The same-store key performance indicators presented below exclude the hospitality
metrics for the West Glacier Properties (acquired July 1, 2014), as well as the attraction metrics for the Glacier
Skywalk attraction (opened May 2014) as they do not have comparable results for the same periods in 2013.
Hospitality:
Room nights available
RevPAR
ADR
Occupancy
Attractions:
Passengers
Total attraction revenue per passenger
2014
2013
Change
218,913
220,989
102
149
$
$
68.2%
97
151
64.4%
1,053,496
915,598
37
$
37
$
$
$
(0.9)%
5.2 %
(1.3)%
3.8 %
15.1 %
— %
Hospitality. The increase in RevPAR in 2014 was primarily due to higher occupancy and ADR at the Mount
Royal Hotel, the Banff International Hotel, and the Glacier View Inn driven by increased visitation to Banff and
Jasper National Parks. The Grouse Mountain Lodge also experienced higher RevPAR driven by the Company’s
renovations in 2012 and 2013. These increases were partially offset by reduced occupancy at the Denali Backcountry
Lodge, which experienced flooding early in its operating season, and at Glacier Park Lodge, which experienced
especially strong occupancy in 2013 as a result of its centennial anniversary. The decrease in ADR was primarily
driven by offering lower rates at the Prince of Wales Hotel in response to softer demand as compared to prior year
and higher occupancy during the off-peak season at the Grouse Mountain Lodge when rates were lower. The
decrease in room nights available from 2013 to 2014 was due to changes in seasonal opening and closing dates of
certain Glacier Park properties. Management schedules opening and closing dates to optimize profitability based
on anticipated travel patterns, and forecasted occupancy levels and operating expenses.
Attractions. The number of passengers increased in 2014 at all three of Brewster’s attractions (Columbia
Icefield Glacier Adventure, Banff Gondola, and Banff Lake Cruise). The attractions benefited from increased park
visitation traffic, favorable weather conditions, and strong combination ticket sales with the Glacier Skywalk. The
Banff Lake Cruise experienced a substantial increase in individual traffic as a result of implementing additional
departure times in 2014.
During 2014, approximately 75 percent of revenue and 90 percent of segment operating income generated
in the Travel & Recreation Group segment were derived through its Canadian operations. These operations are
largely affected by foreign customer visitation, and, accordingly, increases in the value of the Canadian dollar, as
28
compared to other currencies, could adversely affect customer volumes, revenue and segment operating income
for the Travel & Recreation Group. Additionally, the Travel & Recreation Group is affected by consumer
discretionary spending on tourism activities.
For the 2015 full year, management expects the Travel & Recreation Group’s revenue to increase by a low
single-digit rate from 2014 driven by the growth of the underlying business, largely offset by unfavorable currency
translation. Management anticipates that foreign currency exchange rate variances versus 2014 will have an
unfavorable impact on the Travel & Recreation Group’s 2015 full year revenue and operating income of
approximately $10 million and $3 million, respectively. Also, management anticipates the five acquisitions
completed by Viad since the beginning of 2011 will generate approximately $35 million in revenue in 2015 with
an average Adjusted EBITDA margin (defined as Adjusted EBITDA divided by revenue) of more than 30 percent.
By leveraging economies of scale and scope and repositioning the acquired assets for higher returns, management
expects to realize continued revenue growth and expanding Adjusted EBITDA margins in future years.
Corporate Activities. Corporate activities expense of $14.3 million in 2014 increased from $6.8 million.
This increase was primarily related to acquisition transaction-related costs of $4.2 million, CEO transition costs
of $2.7 million, and higher 401(k) employer matching contributions expense due to the depletion of the Company’s
common stock held in the Employee Stock Ownership Plan feature of the Company’s 401(k). Matching
contributions are now funded from shares of Viad common stock held in treasury which have a higher cost to the
Company.
Restructuring Charges. In 2014, Viad recorded net restructuring charges of $1.6 million ($1.0 million after-
tax) primarily related to updated estimates of facility contractual arrangements and the elimination of certain
positions in the Marketing & Events Group. In 2013, Viad recorded net restructuring charges of $3.8 million ($2.6
million after-tax) primarily related to facility consolidations and the elimination of certain positions in the Marketing
& Events Group. In addition, restructuring charges related to the elimination of certain positions in the Travel &
Recreation Group and at Viad corporate were also recorded in 2013.
Impairment Charges. In 2014, Viad recorded impairment charges of $0.9 million ($0.5 million after-tax)
at the Marketing & Events Group primarily related to the write-off of certain internally developed software. In
2013, Viad recorded impairment charges of approximately $3.1 million ($1.6 million after-tax) related to the non-
cash write-down of goodwill at Glacier Park of $2.1 million ($1.0 million after-tax) and $1.0 million ($0.6 million
after-tax) related to the write-off of certain assets within the Marketing & Events Group.
Income Taxes. The effective tax rate for 2014 was 0.2 percent, as compared to 30.1 percent for 2013. The
decrease in the effective tax rate for 2014 was primarily due to a benefit related to the reversal of a valuation
allowance associated with foreign tax credits. During the third quarter of 2014, it was determined that certain
deferred tax assets associated with foreign tax credits, for which a valuation allowance had previously been
established, once again met the “more-likely-than-not” test in the accounting standards regarding the realization
of those assets. Accordingly, Viad recorded a tax benefit of $10.1 million to income tax expense during the 2014
third quarter.
Discontinued Operations. On December 31, 2013, Glacier Park’s concession contract with the Park Service
to operate lodging, tour and transportation and other hospitality services for Glacier National Park expired. Upon
completion of the contract term, Viad received cash payments in January 2014 totaling $25.0 million for the
Company’s possessory interest. This resulted in a pre-tax gain of $21.5 million and an after-tax gain of $13.5
million that was recorded as income from discontinued operations. In addition, 2014 income from discontinued
operations included approximately $0.7 million, net of tax, related to the gain on sale of personal property at Glacier
Park, as well as an insurance recovery of $0.3 million, net of tax, and adjustments to reserves related to certain
liabilities associated with previously sold operations.
The Company’s 2013 results related to the operations of Glacier Park’s concession contract business have
been reclassified as discontinued operations. Accordingly, for the 2013 full year, approximately $19 million in
revenue and $4 million in operating income has been reclassified as discontinued operations.
29
Glacier Park continues to generate revenue from the seven properties it owns: St. Mary Lodge in St. Mary,
Montana; Glacier Park Lodge in East Glacier, Montana; Grouse Mountain Lodge in Whitefish, Montana; the Prince
of Wales Hotel in Waterton Lakes National Park, Alberta; the West Glacier Motel & Cabins in West Glacier,
Montana; and Motel Lake McDonald and the Apgar Village Lodge, which are located inside Glacier National Park.
Glacier Park also continues to operate the food and beverage operations and package tour and transportation services
with respect to these properties and the retail shops located near Glacier National Park.
In addition, 2013 income from discontinued operations included $1.1 million, net of tax, primarily related
to the sale of land associated with a previously sold operation.
2013 vs. 2012:
The following are consolidated highlights:
• Total revenue was $953.3 million, as compared to $1.0 billion in 2012. The decrease in revenue was
primarily driven by negative show rotation and services provided in 2012 in connection with the Summer
Olympic and Paralympic Games by the Marketing & Events Group.
• Total segment operating income was $41.9 million, as compared to $38.2 million in 2012. The increase
in operating results, despite revenue declines, was primarily driven by continued same-show growth and
focus on margin improvement at the Marketing & Events Group, as well as expanded revenues at all
three operating units within the Travel & Recreation Group.
• Diluted income per share from continuing operations attributable to Viad shareholders was $0.96, as
•
compared to $0.17 in 2012.
Income from discontinued operations attributable to Viad was $2.1 million and $2.5 million in 2013
and 2012, respectively. This related partly to the operations of the Glacier Park concession contract of
$1.0 million and $1.9 million in 2013 and 2012, respectively. The Company’s 2013 and 2012 results
related to the operations of Glacier Park’s concession contract business have been reclassified as
discontinued operations. Additionally, the Company had income from the sale of land associated with a
previously sold operation of $1.1 million and $0.6 million for 2013 and 2012, respectively.
• Net income attributable to Viad was $21.6 million, as compared to $5.9 million in 2012.
Foreign Exchange Rate Variances
Viad conducts its foreign operations primarily in Canada, the United Kingdom, Germany and to a lesser
extent in certain other countries.
During 2013, foreign exchange rate variances resulted in decreases in revenues and segment operating income
of $7.0 million and $1.0 million, respectively, as compared to 2012. The following table summarizes the effects
of foreign exchange rate variances on revenue and segment operating results from Viad’s significant international
operations:
Marketing & Events Group:
Canada
United Kingdom
Germany
Travel & Recreation Group:
Canada
$
$
$
$
Revenues
Segment Operating Results
Weighted-Average
Exchange Rates
2013
2012
Effect of Rate
Variance
(in thousands)
Weighted-Average
Exchange Rates
2013
2012
Effect of Rate
Variance
(in thousands)
0.97
1.56
1.33
$
$
$
1.00
1.59
1.29
0.96
$
1.00
$
$
$
$
$
$
(2,103) $
(2,582) $
$
419
(4,266)
(2,756) $
(7,022)
0.99
1.57
1.33
$
$
$
1.04
1.60
1.27
0.96
$
1.00
$
$
$
$
$
$
(65)
(138)
(37)
(240)
(790)
(1,030)
30
Viad’s results were primarily impacted by the weakening of the Canadian dollar and British pound relative
to the U.S. dollar. Future changes in the exchange rates may impact overall expected profitability and historical
period-to-period comparisons when operating results are translated into U.S. dollars.
Analysis of Operating Results by Reportable Segment
(in thousands)
Revenue:
Marketing & Events Group:
U.S.
International
Intersegment eliminations
Total Marketing & Events Group
Travel & Recreation Group
Total revenue
Segment operating income:
Marketing & Events Group:
U.S.
International
Total Marketing & Events Group
Travel & Recreation Group
Segment operating income
Marketing & Events Group
Year Ended December 31,
2013
2012
Change
$
$
$
$
628,856
229,312
(13,264)
844,904
108,443
953,347
11,024
9,068
20,092
21,819
41,911
$
$
$
$
676,772
240,137
(14,869)
902,040
104,604
1,006,644
5,579
12,321
17,900
20,291
38,191
$
$
$
$
(47,916)
(10,825)
1,605
(57,136)
3,839
(53,297)
5,445
(3,253)
2,192
1,528
3,720
(7.1)%
(4.5)%
(10.8)%
(6.3)%
3.7 %
(5.3)%
97.6 %
(26.4)%
12.2 %
7.5 %
9.7 %
U.S. Segment. Revenue for the Marketing & Events U.S. segment was $628.9 million for 2013, down 7.1
percent, as compared to $676.8 million in 2012. The decrease was primarily due to negative show rotation revenue
of approximately $54 million, partially offset by base same-show revenue increases of 3.1 percent. Base same-
shows represented 46 percent of Marketing & Events U.S. segment revenue in 2013. The 2013 segment operating
income was $11.0 million, as compared to $5.6 million in 2012. The improved operating results were primarily
due to lower performance-based incentives, the third quarter gain on sale of a facility in New Jersey and ongoing
efforts to drive operating efficiencies.
International Segment. Results for the Marketing & Events International segment were affected by exchange
rate variances, which had an unfavorable impact on revenue of $4.3 million and segment operating income of $0.2
million, as compared to 2012. Excluding exchange rate variances, 2013 revenue decreased by $6.6 million, or 2.7
percent, and segment operating income decreased by $3.0 million, or 24.5 percent. These decreases were primarily
driven by services provided for the 2012 London Summer Olympics and Paralympic Games, partially offset by
positive show rotation revenue of approximately $6 million.
Travel & Recreation Group
Seasonality. The Travel & Recreation Group segment experiences peak activity during the summer months.
During 2013, 83 percent of its revenue was earned in the second and third quarters.
Results for the Travel & Recreation Group segment for 2013 were affected by exchange rate variances, which
had an unfavorable impact on revenue and segment operating income of $2.8 million and $0.8 million, respectively,
as compared to 2012. Excluding exchange rate variances, revenue increased by $6.6 million, or 6.3 percent, and
segment operating income increased by $2.3 million, or 11.4 percent.
31
During 2013, results were negatively impacted by extensive flooding that took place on June 20, 2013, in
Alberta, Canada. Major pieces of infrastructure in the province were affected and many roads became impassable,
which temporarily restricted access to Brewster’s hotel properties and attractions in the area. The provincial
authorities were able to restore road access to Banff for both commercial and private vehicles by June 26, 2013,
ahead of the Canada Day holiday weekend. Management started seeing more normalized occupancy and visitor
traffic in August. Management estimates that the flooding had an unfavorable impact on 2013 revenue of
approximately $2 million. Brewster recovered well from the flooding that occurred in late June and delivered solid
growth for the full year across nearly all of its lines of business.
The following table provides Travel & Recreation Group revenue by line of business:
(in thousands)
Revenues:
Hospitality
Attractions
Package tours
Transportation
Intra-segment eliminations & other
2013
2012
Change
$
38,236
$
36,089
$
2,147
36,102
18,950
17,247
(2,092)
35,434
18,805
16,858
(2,582)
104,604
668
145
389
490
$
3,839
5.9 %
1.9 %
0.8 %
2.3 %
(19.0)%
3.7 %
Total
$
108,443
$
Revenue. The increase in revenue in 2013 was primarily driven by hospitality and attractions. The revenue
growth from hospitality properties was primarily due to improved results at most of the lodges and hotels. Glacier
Park saw strong results, particularly at the Grouse Mountain Lodge, which was recently updated and refreshed. In
addition, the Banff International Hotel, which was acquired on March 7, 2012, benefited from a full first quarter
contribution. The improved results from attractions were primarily due to increased passenger counts at the
Columbia Icefield Glacier Adventure, the Banff Gondola, and the Banff Lake Cruise.
The following table provides Travel & Recreation Group same-store key performance indicators. The same-
store key performance indicators presented below exclude the metrics for the Banff International Hotel (acquired
in March 2012), as well as all of the hospitality properties and the Red Bus Tours attraction that were part of Glacier
Park’s expired concession contract with the Park Service.
Hospitality:
Room nights available
RevPAR
ADR
Occupancy
Attractions:
Passengers
Total attraction revenue per passenger
2013
2012
Change
161,859
163,434
$
$
110
166
66.1%
99
159
62.5%
915,598
906,645
39
$
38
$
$
$
(1.0)%
11.1 %
4.4 %
3.6 %
1.0 %
2.6 %
Hospitality. The increase in RevPAR reflects improvement across most properties. The Grouse Mountain
Lodge experienced particularly strong growth in occupancy driven by the Company’s renovations in 2012 and
2013. The increase in ADR was primarily driven by the Denali Backcountry Lodge, St. Mary Lodge and Resort,
and the Glacier Park Lodge. The Denali Backcountry Lodge experienced stronger bookings than expected in 2013,
which allowed management to offer higher rates. In addition, the Glacier Park Lodge centennial anniversary in
2013 increased demand for Glacier Park properties, which was matched with higher rates. The decrease in room
nights available from 2012 to 2013 was due to changes in seasonal opening and closing dates of certain Glacier
32
Park properties. Management schedules opening and closing dates to optimize profitability based on anticipated
travel patterns, and forecasted occupancy levels and operating expenses.
Attractions. The number of passengers increased in 2013 at all three of Brewster attractions (Banff Gondola,
Columbia Icefield Glacier Adventure, and Banff Lake Cruise), despite the flood impact. The increase in revenue
per passenger was mainly driven by increased ticket prices at the Banff Gondola attraction.
For the 2013 full year, approximately 75 percent of revenue and 88 percent of segment operating income
generated in the Travel & Recreation Group segment were derived through its Canadian operations. These
operations are largely affected by foreign customer visitation, and, accordingly, increases in the value of the
Canadian dollar, as compared to other currencies, could adversely affect customer volumes, revenue and segment
operating income for the Travel & Recreation Group. Additionally, the Travel & Recreation Group is affected by
consumer discretionary spending on tourism activities.
Corporate Activities. Corporate activities expense of $6.8 million in 2013 decreased from $9.4 million in
2012. This decrease was primarily due to lower performance-based compensation expense in 2013, as well as
higher costs in 2012 related to the amendment and restatement of the Company’s shareholder rights plan and higher
legal costs related to employee benefits associated with previously divested operations. These decreases were
partially offset by 2013 costs related to the Company’s strategic review process.
Restructuring Charges. In 2013, Viad recorded net restructuring charges of $3.8 million, as compared to
$4.9 million in 2012. The 2013 charges primarily related to reorganization activities in the Marketing & Events
Group, comprised of the elimination of certain positions. In addition, restructuring charges related to the elimination
of certain positions in the Travel & Recreation Group and at Viad corporate were also recorded in 2013.
Impairment Charges. Viad recorded a non-cash impairment charge of approximately $3.1 million in 2013
related to the non-cash write down of goodwill at the Glacier Park reporting unit of $2.1 million and $1.0 million
related to the write-off of certain assets within the Marketing & Events Group.
Income Taxes. The effective tax rate for 2013 was 30.1 percent, as compared to 84.6 percent for 2012. The
high rate for 2012, as compared to the statutory rate, was due to the charge to income tax expense of $13.4 million,
representing a valuation allowance for certain deferred tax assets associated with foreign tax credit carryforwards.
Discontinued Operations. On December 31, 2013, Glacier Park’s concession contract with the Park Service
to operate lodging, tour and transportation and other hospitality services for Glacier National Park expired. The
Company’s 2013 and 2012 results related to the operations of Glacier Park’s concession contract business have
been reclassified as discontinued operations. Accordingly, for both the 2013 and 2012 full year, approximately
$19 million in revenue and $4 million in operating income have been reclassified as discontinued operations.
In addition, 2013 and 2012 income from discontinued operations included $1.1 million, net of tax, and $0.6
million, net of tax, primarily related to the sale of land associated with a previously sold operation.
Liquidity and Capital Resources
Cash and cash equivalents were $57.0 million as of December 31, 2014, as compared to $45.8 million as of
December 31, 2013. During 2014, the Company generated net cash flows from operating activities of $58.1 million
primarily driven by operating results, somewhat offset by changes in working capital. Management believes that
Viad’s existing sources of liquidity will be sufficient to fund operations and capital commitments for at least the
next 12 months.
As of December 31, 2014, the Company had approximately $40.1 million of its cash and cash equivalents
held outside of the United States. Of the total amount, $24.3 million was held in Canada, $11.7 million in the
United Kingdom, $2.1 million in Germany, $1.0 million in the United Arab Emirates and $1.0 million in the
Netherlands. There were certain historical earnings related to its Canadian operations which, if repatriated to the
United States, would result in incremental income tax expense. The incremental tax liability as of December 31,
33
2014 that would result assuming all foreign cash balances were repatriated to the United States would be
approximately $1.0 million.
Cash Flows
Operating Activities
(in thousands)
Net income
Depreciation and amortization
Income from discontinued operations
Other non-cash items
Changes in assets and liabilities
2014
2013
2012
$
55,567
$
21,686
$
30,792
(14,389)
34
(13,914)
58,090
$
27,967
(2,366)
13,769
(55,001)
6,055
$
6,583
30,133
(3,030)
33,106
2,394
69,186
Net cash provided by operating activities
$
2014 - Non-cash items include $2.9 million of share-based compensation expense and $1.6 million of
restructuring charges. The changes in assets and liabilities primarily consisted of a $12.6 million unfavorable
change in other assets and liabilities, an $10.4 million increase in receivables and a $6.4 million decrease in customer
deposits, partially offset by a $18.1 million increase in accounts payable.
2013 - Non-cash items consisted of $5.2 million of share-based compensation expense and $3.0 million of
impairment charges offset by a gain on facility and related land of $4.8 million and $3.8 million of restructuring
charges. The changes in assets and liabilities primarily consisted of a $21.0 million decrease in customer deposits,
a $15.4 million decrease in accounts payable and an $11.7 million decrease in accrued compensation.
2012 - Non-cash items primarily consisted of $11.3 million of deferred income taxes related to the valuation
allowance for foreign tax credit carryforwards and $7.2 million of share-based compensation expense. The changes
in assets and liabilities primarily consisted of a $4.7 million decrease in restructuring liabilities partially offset by
a $4.3 million increase in accounts payable.
Investing Activities
(in thousands)
Proceeds from possessory interest and personal property
- discontinued operations
Proceeds from dispositions of property and other assets
Acquisition of businesses, net of cash acquired
Capital expenditures
Proceeds from sale of facility and related land
Proceeds from the sale of land - discontinued operations
Proceeds from sale of short-term investments
Net cash used in investing activities
2014
2013
2012
$
28,000
$
— $
1,109
(120,251)
(29,389)
—
—
—
$
(120,531) $
464
(647)
(36,119)
12,696
1,645
—
(21,961) $
—
322
(23,546)
(27,675)
—
1,041
384
(49,474)
2014 - Cash used in investing activities was driven by $120.3 million of costs related to the acquisitions of
the West Glacier Properties, Blitz, onPeak and N200 and $29.4 million of capital expenditures primarily related
to the construction of a versatile wall system at the Marketing & Events U.S. segment and equipment and computer
hardware at both the Marketing & Events Group and Travel & Recreation Group. This was partially offset by $28.0
million received for the Company’s possessory interest and personal property at Glacier Park. For additional
information, refer to Note 3, Acquisition of Businesses and Note 24, Discontinued Operations, of Notes to
Consolidated Financial Statements.
34
2013 - Cash used in investing activities of $22.0 million was driven by $36.1 million of capital expenditures
primarily related to the construction of the Glacier Skywalk at the Travel & Recreation Group of $12.7 million as
well as equipment and computer hardware at the Marketing & Events U.S. segment. Partially offsetting this was
$14.3 million of proceeds from the sale of a facility and related land in the Marketing & Events Group and the
sale of land from a discontinued operation.
2012 - Cash used in investing activities primarily consisted of $27.7 million used for capital expenditures
related to the purchase of rental inventory, equipment and computer hardware and leasehold improvements at the
Marketing & Events U.S. segment as well as Glacier Skywalk construction costs of $8.9 million (with an accrued
capital expenditure amount of $2.6 million as of December 31, 2012) and building and other improvements at the
Travel & Recreation Group, and $23.5 million used for the acquisition of the Banff International Hotel and related
assets, net of cash acquired.
Financing Activities
(in thousands)
Proceeds from borrowings
Payments on debt and capital lease obligations
Dividends paid on common stock
Common stock purchased for treasury
Debt issuance costs
Other
2014
2013
2012
$
$
189,512
(61,461)
(38,387)
(12,321)
(1,671)
1,269
$
20,000
(11,362)
(58,914)
(1,328)
—
1,199
(50,405) $
—
(2,685)
(4,454)
(1,656)
—
541
(8,254)
Net cash provided by (used in) financing activities
$
76,941
$
2014 - Cash provided by financing activities primarily consisted of $128.1 million of net proceeds from
borrowings, partially offset by $38.4 million used for payments of dividends on common stock. On January 24,
2014 Viad announced that its Board of Directors declared special cash dividends of $1.50 per share to shareholders
of record at the close of business on February 7, 2014.
2013 - Cash used in financing activities primarily consisted of $58.9 million used for payments of dividends
on common stock, partially offset by net proceeds from borrowings of $8.6 million. On October 25, 2013, Viad
announced that its Board of Directors declared special cash dividends of $2.50 per share to shareholders of record
at the close of business on November 7, 2013.
2012 - Cash used in financing activities primarily consisted of $4.5 million used for payments of dividends
on common stock and $2.7 million used for payments on debt and capital lease obligations. In August 2012, Viad’s
Board of Directors approved a 150 percent increase in the quarterly dividend from $0.04 per share to $0.10 per
share.
Debt
Effective December 22, 2014, Viad entered into a $300 million Amended and Restated Credit Agreement
(the “Credit Agreement”). The Credit Agreement amends and replaces in its entirety the Company’s $180 million
revolving credit facility under the Amended and Restated Credit Agreement dated as of May 18, 2011. The Credit
Agreement provides for a senior credit facility in the aggregate amount of $300 million, which consists of a $175
million revolving credit facility (the “Revolving Credit Facility”) and a $125 million term loan (the “Term Loan”).
Loans under the Credit Agreement have a maturity date of December 22, 2019, and proceeds from the loans made
under the Credit Agreement were used to refinance certain outstanding debt of the Company and will be used for
the Company’s general corporate purposes in the ordinary course of its business. Under the Credit Agreement, the
Revolving Credit Facility and/or the Term Loan may be increased up to an additional $100 million under certain
circumstances. If such circumstances are met, the Company may obtain the additional borrowings under the
Revolving Credit Facility, the Term Loan, or a combination of the two facilities. The Revolving Credit Facility
35
has a $40 million sublimit for letters of credit. Borrowings and letters of credit can be denominated in U.S. dollars,
Euros, Canadian dollars or British pounds.
Viad’s lenders have a first perfected security interest in all of the personal property of Viad, GES and GES
Event Intelligence Services, Inc., including 65 percent of the capital stock of top-tier foreign subsidiaries. Financial
covenants include a fixed charge coverage ratio of not less than 1.75 to 1.00, with a step-up to 2.00 to 1.00 for the
fiscal quarter ending June 30, 2016. Viad must maintain a leverage ratio of not greater than 3.00 to 1.00, with a
step-down to 2.75 to 1.00 for the fiscal quarter ending March 31, 2016 and a step-down to 2.50 to 1.00 for the
fiscal quarter ending March 31, 2017. As of December 31, 2014, the fixed charge coverage ratio was 2.61 to 1.00,
and the leverage ratio was 1.73 to 1.00. The terms of the Credit Agreement allow Viad to pay dividends or purchase
the Company’s common stock up to $20 million in the aggregate in any calendar year, with additional dividends,
share repurchases or distributions of stock permitted if the Company’s leverage ratio is less than or equal to 2.00
to 1.00, and the Liquidity Amount (defined as cash in the U.S. and Canada plus available revolver borrowings on
a pro forma basis) is not less than $100 million, and no default or unmatured default, as defined in the Credit
Agreement, exists. Significant other covenants include limitations on investments, additional indebtedness, sales/
leases of assets, acquisitions, consolidations or mergers and liens on property. As of December 31, 2014, Viad was
in compliance with all covenants.
As of December 31, 2014, Viad’s total debt of $141.0 million consisted of outstanding borrowings under
the Term Loan and Revolving Credit Facility of $125.0 million and $14.5 million, respectively, and capital lease
obligations of $1.5 million. As of December 31, 2014, Viad had $159.4 million of capacity remaining under its
Credit Facility reflecting outstanding letters of credit of $1.1 million and the outstanding balance under the
Revolving Credit Facility of $14.5 million.
Borrowings under the Revolving Credit Facility (of which GES and GES Event Intelligence Services, Inc.
are guarantors) are indexed to the prime rate or the London Interbank Offered Rate, plus appropriate spreads tied
to Viad’s leverage ratio. Commitment fees and letters of credit fees are also tied to Viad’s leverage ratio. The fees
on the unused portion of the Credit Facility are currently 0.35 percent annually.
Guarantees
As of December 31, 2014, Viad had certain obligations under guarantees to third parties on behalf of its
subsidiaries. These guarantees are not subject to liability recognition in the consolidated financial statements and
relate to leased facilities entered into by the Company’s subsidiary operations. The Company would generally be
required to make payments to the respective third parties under these guarantees in the event that the related
subsidiary could not meet its own payment obligations. The maximum potential amount of future payments that
Viad would be required to make under all guarantees existing as of December 31, 2014 would be $5.9 million.
These guarantees relate to leased facilities and expire through October 2017. There are no recourse provisions that
would enable Viad to recover from third parties any payments made under the guarantees. Furthermore, there are
no collateral or similar arrangements whereby Viad could recover payments.
Share Repurchases
Viad has announced the authorization of its Board of Directors to repurchase shares of the Company’s
common stock on the open market from time to time at prevailing market prices. During 2014, the Company
repurchased 448,436 shares on the open market at a total cost of $10.6 million. No shares were repurchased on
the open market during 2013. As of December 31, 2014, 582,002 shares remained available for repurchase.
Additionally, during 2014 and 2013, the Company withheld 72,996 shares for $1.8 million and 50,156 shares for
$1.3 million, respectively, related to tax withholding requirements on share-based awards.
Subsequent to December 31, 2014, the Company repurchased141,462 shares on the open market at a cost
of approximately $3.8 million. Refer to Note 26, Subsequent Event, of Notes to Consolidated Financial Statements.
36
Contractual Obligations
The following table presents Viad’s contractual obligations as of December 31, 2014:
(in thousands)
Revolver and term loan borrowings
Operating leases
Pension and postretirement benefits(1)
Purchase obligations(2)
Capital lease obligations
Estimated interest payments
$
Total contractual cash obligations(3)
$
Payments due by period
Less than
1 year
1-3 years
3-5 years
More than
5 years
Total
27,000
16,343
3,179
17,735
856
81
38,194
$
$
37,500
26,824
6,831
9,069
661
57
43,442
$
$
75,000
18,627
7,102
1,437
3
—
27,169
$
$
— $ 139,500
71,549
35,441
28,245
1,520
138
$ 136,893
9,755
18,329
4
—
—
28,088
(1) Estimated contributions related to multi-employer benefit plans are excluded from the table above. Refer to
Note 18, Pension and Postretirement Benefits, of Notes to Consolidated Financial Statements for disclosures
regarding those obligations.
(2) Purchase obligations primarily represent payments due under various licensing agreements and commitments
related to consulting and other contracted services that are enforceable and legally binding and that specify all
significant terms, including open purchase orders.
(3) Aggregate self-insurance liabilities of $32.1 million are excluded from the table above as the timing and amounts
of future cash outflows are uncertain. Refer to Note 9, Other Current Liabilities and Note 10, Other Deferred
Liabilities, of Notes to Consolidated Financial Statements.
Viad and certain of its subsidiaries are plaintiffs or defendants to various actions, proceedings and pending
claims, some of which involve, or may involve, compensatory, punitive or other damages. Litigation is subject to
many uncertainties and it is possible that some of the legal actions, proceedings or claims could be decided against
Viad. Although the amount of liability as of December 31, 2014 with respect to these matters is not ascertainable,
Viad believes that any resulting liability, after taking into consideration amounts already provided for and insurance
coverage, will not have a material effect on Viad’s business, financial position or results of operations.
Viad is subject to various U.S. federal, state and foreign laws and regulations governing the prevention
of pollution and the protection of the environment in the jurisdictions in which Viad has or had operations. If
the Company has failed to comply with these environmental laws and regulations, civil and criminal penalties
could be imposed and Viad could become subject to regulatory enforcement actions in the form of injunctions
and cease and desist orders. As is the case with many companies, Viad also faces exposure to actual or potential
claims and lawsuits involving environmental matters relating to its past operations. Although it is a party to certain
environmental disputes, Viad believes that any resulting liabilities, after taking into consideration amounts already
provided for and insurance coverage, will not have a material effect on the Company’s financial position, results
of operations or liquidity. As of December 31, 2014, there was a remaining environmental remediation liability of
approximately $4.7 million related to previously sold operations of which $0.4 million is included in the
consolidated balance sheets under the caption “Other current liabilities” and $4.4 million under the caption “Other
deferred items and liabilities.”
Viad’s businesses contribute to various multi-employer pension plans based on obligations arising under
collective-bargaining agreements covering its union-represented employees. Viad’s contributions to these plans in
2014, 2013 and 2012 totaled $23.2 million, $20.3 million and $20.7 million, respectively. Based upon the
information available to Viad from plan administrators, management believes that several of these multi-employer
plans are underfunded. The Pension Protection Act of 2006 requires pension plans underfunded at certain levels
to reduce, over defined time periods, the underfunded status. In addition, under current laws, the termination of a
plan, or a voluntary withdrawal from a plan by Viad, or a shrinking contribution base to a plan as a result of the
insolvency or withdrawal of other contributing employers to such plan, would require Viad to make payments to
37
such plan for its proportionate share of the plan’s unfunded vested liabilities. As of December 31, 2014, the amount
of additional funding, if any, that Viad would be required to make related to multi-employer pension plans is not
ascertainable.
Off-Balance Sheet Arrangements:
Viad does not have any “off-balance sheet” arrangements with unconsolidated special-purpose or other
entities that would materially affect the Company’s financial position, results of operations, liquidity or capital
resources. Furthermore, Viad does not have any relationships with special-purpose or other entities that provide
off-balance sheet financing; liquidity, market risk or credit risk support; or engage in leasing or other services that
may expose the Company to liability or risks of loss that are not reflected in Viad’s consolidated financial statements
and related notes. See Notes 11, 20 and 21 of Notes to Consolidated Financial Statements.
Critical Accounting Policies and Estimates:
The preparation of financial statements in conformity with GAAP requires estimates and assumptions that
affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent
assets and liabilities in the consolidated financial statements. The SEC has defined a company’s most critical
accounting policies as those that are most important to the portrayal of a company’s financial position and results
of operations, and that require a company to make its most difficult and subjective judgments, often as a result of
the need to make estimates of matters that are inherently uncertain. Based on these criteria, Viad has identified and
discussed with its audit committee the following critical accounting policies and estimates pertaining to Viad, and
the methodology and disclosures related to those estimates:
Goodwill — Goodwill is not amortized, but tested for impairment at the reporting unit level on an annual
basis as of October 31 of each year. Goodwill is also tested for impairment between annual tests if an event occurs
or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying
amount. Viad’s reporting units are defined, and goodwill is tested, at either an operating segment level or at the
component level of an operating segment, depending on various factors including the internal reporting structure
of the operating segment, the level of integration among components, the sharing of assets and other resources
among components and the benefits and likely recoverability of goodwill by the component’s operations.
For impairment testing purposes, the goodwill related to the Marketing & Events U.S. segment is assigned
to and tested at the operating segment level, which represents all domestic operations of GES. Furthermore, the
goodwill related to the Marketing & Events International segment is assigned to and tested based on the segment’s
geographical operations. For the Marketing & Events International segment the reporting units are GES United
Kingdom and GES Canada. Brewster, Glacier Park and Alaska Denali Travel are considered reporting units for
goodwill impairment testing purposes.
38
As of December 31, 2014, Viad had total goodwill of $194.2 million consisting of $152.8 million related to
the Marketing & Events Group and $41.4 million related to the Travel & Recreation Group. The following table
summarizes goodwill balances by reporting unit and segment as of December 31:
(in thousands)
Marketing & Events Group:
Marketing & Events U.S.
Marketing & Events International:
GES United Kingdom
GES Canada
Total Marketing & Events Group
Travel & Recreation Group:
Brewster
Alaska Denali Travel
Glacier Park
Total Travel & Recreation Group
Total Goodwill
2014
2013
$
110,618
$
62,686
34,396
7,825
152,839
36,906
3,184
1,268
41,358
194,197
$
14,049
8,562
85,297
41,062
3,184
—
44,246
129,543
$
Viad uses a discounted expected future cash flow methodology (income approach) in order to estimate the
fair value of its reporting units for purposes of goodwill impairment testing. The estimates and assumptions
regarding expected future cash flows, discount rates and terminal values require considerable judgment and are
based on market conditions, financial forecasts, industry trends and historical experience.
The most critical assumptions and estimates in determining the estimated fair value of its reporting units
relate to the amounts and timing of expected future cash flows for each reporting unit and the reporting unit cost
of capital (discount rate) applied to those cash flows. Furthermore, the assumed reporting unit cost of capital rates
(discount rates) are estimated using a build-up method based on the perceived risk associated with the cash flows
pertaining to the specific reporting unit. In order to assess the reasonableness of its fair value estimates, the Company
performs a reconciliation of the aggregate fair values of its reporting units to Viad’s market capitalization.
As noted above, the estimates and assumptions regarding expected future cash flows, discount rates and
terminal values require considerable judgment and are based on market conditions, financial forecasts, industry
trends and historical experience. These estimates, however, have inherent uncertainties and different assumptions
could lead to materially different results. As of December 31, 2014, Viad had aggregate goodwill of $194.2 million
recorded in the consolidated balance sheets. Furthermore, as a result of the Company’s most recent impairment
analysis performed as of October 31, 2014, the excess of the estimated fair value over the carrying value (expressed
as a percentage of the carrying amounts) under step one of the impairment test was 142 percent, 48 percent and
52 percent for each of the Marketing & Events Group reporting units in the United States, the United Kingdom
and Canada, respectively. For the Brewster, Glacier Park and Alaska Denali Travel reporting units, the excess of
the estimated fair value over the carrying value was 167 percent, 16 percent and 14 percent, respectively, as of the
most recent impairment test. Significant reductions in the Company’s expected future revenues, operating income
or cash flow forecasts and projections, or an increase in reporting unit cost of capital, could trigger additional
goodwill impairment testing, which may result in impairment charges. See “Results of Operations” above and
Note 8 of Notes to Consolidated Financial Statements for a discussion of the goodwill impairment loss recorded
during 2013 related to Glacier Park.
Income taxes — Viad is required to estimate and record provisions for income taxes in each of the jurisdictions
in which the Company operates. Accordingly, the Company must estimate its actual current income tax liability,
and assess temporary differences arising from the treatment of items for tax purposes, as compared to the treatment
for accounting purposes. These differences result in deferred tax assets and liabilities which are included in Viad’s
consolidated balance sheet. The Company uses significant judgment in forming conclusions regarding the
39
recoverability of its deferred tax assets and evaluates all available positive and negative evidence to determine if
it is more-likely-than-not that the deferred tax assets will be realized. To the extent recovery does not appear likely,
a valuation allowance must be recorded. As of December 31, 2014 and 2013, Viad had gross deferred tax assets
of $69.2 million and $77.0 million, respectively. These deferred tax assets reflect the expected future tax benefits
to be realized upon reversal of deductible temporary differences, and the utilization of net operating loss and tax
credit carryforwards.
During the third quarter of 2014, the Company released a $10.9 million valuation allowance associated with
foreign income tax credits. The Company considered all available positive and negative evidence regarding the
future recoverability of the foreign tax credits, including recent operating history, future reversals of deferred tax
liabilities, utilization history and projected future U.S. taxable income. Based on the evaluation of all positive and
negative evidence, it was determined to be more likely than not that the foreign tax credits carryforwards would
be utilized before their expiration. At the end of 2014, the remaining foreign tax credit carryforwards are $12.7
million. If not utilized, the tax credits will begin to expire during 2020.
While management believes that the deferred tax assets, net of existing valuation allowances will be utilized
in future periods, there are inherent uncertainties regarding the ultimate realization of these assets. It is possible
that the relative weight of positive and negative evidence regarding the realization of deferred tax assets may
change, which could result in a material increase or decrease in the Company’s valuation allowance. Such a change
could result in a material increase or decrease to income tax expense in the period the assessment was made.
Viad has not recorded deferred taxes on certain historical unremitted earnings of its Canadian subsidiaries
as management intends to reinvest those earnings in its Canadian operations. As of December 31, 2014, the
incremental unrecognized tax liability (net of estimated foreign tax credits) related to those undistributed earnings
was approximately $350,000. To the extent that circumstances change and it becomes apparent that some or all of
those undistributed earnings will be remitted to the U.S., Viad would accrue income taxes attributable to such
remittance.
The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process
in which a determination is first made as to whether it is more likely than not that the tax positions will be sustained
on the basis of the technical merits of the position. For all tax positions meeting this threshold, Viad recognizes
the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with
the related tax authority.
Pension and postretirement benefits — Viad’s pension plans use traditional defined benefit formulas based
on years of service and final average compensation. Funding policies provide that payments to defined benefit
pension trusts shall be at least equal to the minimum funding required by applicable regulations. The Company
presently anticipates contributing $1.4 million to its funded pension plans and $0.8 million to its unfunded pension
plans in 2015.
Viad and certain of its subsidiaries have defined benefit postretirement plans that provide medical and life
insurance for certain eligible employees, retirees and dependents. The related postretirement benefit liabilities are
recognized over the period that services are provided by employees. In addition, Viad retained the obligations for
these benefits for retirees of certain sold businesses. While the plans have no funding requirements, Viad expects
to contribute $1.1 million to the plans in 2015.
The assumed health care cost trend rate used in measuring the December 31, 2014 accumulated postretirement
benefit obligation was 7.5 percent, declining one-quarter percent each year to the ultimate rate of 5.0 percent by
the year 2024 and remaining at that level thereafter. The assumed health care cost trend rate used in measuring the
December 31, 2013 accumulated postretirement benefit obligation was 8.0 percent, declining one-half percent
each year to the ultimate rate of 5.0 percent by the year 2019 and remaining at that level thereafter.
A one-percentage-point increase in the assumed health care cost trend rate for each year would increase the
accumulated postretirement benefit obligation as of December 31, 2014 by approximately $1.8 million and the
40
total of service and interest cost components by approximately $0.1 million. A one-percentage-point decrease in
the assumed health care cost trend rate for each year would decrease the accumulated postretirement benefit
obligation as of December 31, 2014 by approximately $1.5 million and the total of service and interest cost
components by approximately $0.1 million.
The weighted-average assumptions used to determine the pension and postretirement benefit obligations as
of December 31 were as follows:
Domestic Plans
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
Foreign Plans
Discount rate
Rate of compensation increase
2013
2014
2014
4.01% 4.89% 3.90% 4.60% 4.00% 4.65% 3.85% 4.67%
3.00% 3.00%
3.00% 3.00%
N/A
N/A
N/A
N/A
2013
2014
2014
2013
2013
Weighted-average assumptions used to determine net periodic benefit cost were as follows:
Domestic Plans
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
Foreign Plans
Discount rate
Expected return on plan assets
Rate of compensation increase
2013
2014
2013
2014
4.90% 4.09% 4.60% 3.80% 4.65% 3.85% 4.67% 4.03%
0.00% 0.00% 5.69% 5.44%
4.15% 3.90%
3.00% 3.00%
N/A
N/A
3.00% 4.50%
N/A
N/A
N/A
N/A
2014
2013
2013
2014
The discount rates used in determining future pension and postretirement benefit obligations are based on
rates determined by actuarial analysis and management review, and reflect the estimated rates of return on a high-
quality, hypothetical bond portfolio whose cash flows match the timing and amounts of expected benefit payments.
See Note 18 of Notes to Consolidated Financial Statements.
Share-based compensation — Viad grants share-based compensation awards to officers, directors and
certain key employees pursuant to the 2007 Viad Corp Omnibus Incentive Plan which has a 10-year life and
provides for the following types of awards: (a) incentive and non-qualified stock options; (b) restricted stock and
restricted stock units; (c) performance units or performance shares; (d) stock appreciation rights; (e) cash-based
awards and (f) certain other stock-based awards.
Share-based compensation expense recognized in the consolidated financial statements in 2014, 2013 and
2012 was $2.9 million, $5.2 million and $7.2 million, respectively. Furthermore, the total tax benefits related to
such costs were $1.1 million, $1.9 million and $2.6 million in 2014, 2013 and 2012, respectively. No share-based
compensation costs were capitalized during 2014, 2013 or 2012.
The fair value of restricted stock and performance-based restricted stock awards are based on Viad’s stock
price on the date of grant. Liability-based awards are recorded at estimated fair value, based on the number of units
expected to vest and the level of achievement of predefined performance goals (where applicable) and are
remeasured on each balance sheet date based on Viad’s stock price or the Monte Carlo simulation model until the
time of settlement. The fair value of performance-based awards based on a market condition is determined using
a Monte Carlo simulation. A Monte Carlo simulation requires the use of a number of assumptions, including
historical volatility and correlation of the price of Viad’s stock and the price of the common shares of a comparator
group, a risk-free rate of return and an expected term.Viad uses the Black-Scholes option pricing model for purposes
of determining the fair value of each stock option grant for which key assumptions are necessary. These assumptions
include Viad’s expected stock price volatility, the expected period of time the stock option will remain outstanding,
the expected dividend yield on Viad’s common stock and the risk-free interest rate. While the Company has not
granted stock options since 2010, changes in the assumptions could result in different estimates of the fair value
41
of stock option grants, and consequently impact Viad’s future results of operations. See Note 2 of Notes to
Consolidated Financial Statements.
Impact of Recent Accounting Pronouncements:
For a description of recently issued accounting pronouncements, including the expected dates of adoption
and estimated effects, if any, on Viad’s consolidated financial statements, see Note 1 of Notes to Consolidated
Financial Statements.
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 Annual 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 and any deterioration in the economy
and other risks discussed in Item 1A, “Risk Factors,” included in this Annual Report, 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 Annual Report.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Viad’s market risk exposures relate to fluctuations in foreign exchange rates, interest rates and certain
commodity prices. Foreign exchange risk is the risk that fluctuating exchange rates will adversely affect Viad’s
financial condition or results of operations. 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 results of operations.
Viad conducts its foreign operations primarily in Canada, the United Kingdom, Germany and to a lesser
extent in certain other countries. The functional currency of Viad’s foreign subsidiaries is their local currency.
Accordingly, for purposes of consolidation, Viad translates the assets and liabilities of its 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 in Viad’s 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 net equity position reported in
its consolidated balance sheets. Viad does not currently hedge its equity risk arising from the translation of foreign
denominated assets and liabilities. Viad had cumulative unrealized foreign currency translation gains recorded in
stockholders’ equity of $12.4 million and $30.8 million as of December 31, 2014 and 2013, respectively. During
2014 and 2013, unrealized foreign currency translation losses of $18.4 million and $11.3 million, respectively,
were recorded in other comprehensive income.
In addition, for purposes of consolidation, the revenues, expenses, gains and losses related to Viad’s foreign
operations are translated into U.S. dollars at the average foreign exchange rates for the period. As a result, Viad’s
consolidated results of operations are exposed to fluctuations in foreign exchange rates as the operating results of
its 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-
42
period comparisons. Viad does not currently hedge its net earnings exposure arising from the translation of its
foreign operating results.
The following table summarizes the effect of foreign exchange rate variances on year-over-year revenue and
segment operating results from Viad’s international operations, excluding 2014 acquisitions:
Revenues
Segment Operating Results
Weighted-Average
Exchange Rates
2014
2013
Effect of Rate
Variance
(thousands)
Weighted-Average
Exchange Rates
2014
2013
Effect of Rate
Variance
(thousands)
Canadian Operations:
Marketing & Events Group $
Travel & Recreation Group $
0.90
0.92
United Kingdom Operations:
Marketing & Events Group $
1.65
German Operations:
Marketing & Events Group $
1.32
$
$
$
$
0.97
0.96
1.56
1.33
$
$
$
$
$
(4,635) $
(4,735) $
(9,370)
0.88
0.93
9,105
$
1.66
(58) $
1.35
$
$
$
$
0.99
0.96
1.57
1.33
$
$
$
$
$
(211)
(877)
(1,088)
460
2
As the Canadian operations generated aggregate operating income in 2014, Viad’s segment operating income
has been unfavorably impacted by $1.1 million from the weakening of the Canadian dollar relative to the U.S.
dollar. As the United Kingdom operations generated aggregate operating income in 2014, Viad’s segment operating
income has been favorably impacted by $0.5 million from the strengthening of the British pound relative to the
U.S. dollar. The change in the Euro exchange rate relative to the U.S. dollar did not have a meaningful impact on
Viad's segment operating income.
A hypothetical change of 10 percent in the Canadian exchange rate would have resulted in a change to
operating income of approximately $2.6 million. A hypothetical change of 10 percent in the British pound exchange
rate would have resulted in a change to operating income of approximately $0.9 million, including the results from
the acquisition of Blitz that was completed during the third quarter of 2014. A hypothetical change of 10 percent
in the Euro exchange rate would not have resulted in a meaningful change to operating income, including the
results from the acquisition of N200 that was completed during the fourth quarter of 2014.
Viad is exposed to foreign exchange transaction risk as its foreign subsidiaries have certain revenue
transactions 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 in foreign exchange rates. As of December 31, 2014 and 2013, Viad did not have any significant foreign
currency forward contracts outstanding.
Viad is exposed to short-term and long-term interest rate risk on certain of its debt obligations. Viad currently
does not use derivative financial instruments to hedge cash flows for such obligations.
Viad’s subsidiaries have exposure to changing fuel prices. Periodically, Brewster enters into futures contracts
with an oil company to purchase two types of fuel and specifies the monthly total volume, by fuel product, to be
purchased over the agreed upon term of the contract, which is generally no longer than one year. The main objective
of Viad’s risk policy related to changing fuel prices is to reduce transaction exposure in order to mitigate the cash
flow risk and protect profit margins. There were no fuel contracts outstanding as of December 31, 2014 or 2013.
Item 8. Financial Statements and Supplementary Data.
Refer to Index to Financial Statements for required information.
43
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
None.
Item 9A. 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 disclosure controls and procedures
has been evaluated as of December 31, 2014, 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 December 31,
2014. Disclosure controls and procedures are designed to ensure that information required to be disclosed in the
reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information required to be disclosed in such
reports is accumulated and communicated to management, including the Chief Executive Officer and Chief
Financial Officer, as appropriate to allow for timely decisions regarding required disclosure.
In accordance with the SEC's published guidance, our management has excluded from its assessment the
internal control over financial reporting at Blitz, onPeak and N200, which we acquired on September 16, 2014,
October 7, 2014 and November 24, 2014, respectively, and whose financial statements constitute 19.3% of total
assets and 1.6% of revenues of our consolidated financial statement amounts as of and for the year ended
December 31, 2014.
There were no changes in the Company’s internal control over financial reporting during the fourth quarter
of 2014 that have materially affected, or are reasonably likely to materially affect, internal control over financial
reporting.
Management’s report on internal control over financial reporting and the report of Viad’s independent
registered public accounting firm, Deloitte & Touche LLP, are provided in this Annual Report immediately prior
to the Index to Financial Statements.
Item 9B. Other Information.
None.
44
Item 10. Directors, Executive Officers and Corporate Governance.
PART III
Information regarding directors of Viad, director nomination procedures, the Audit Committee of Viad’s
Board of Directors and compliance with Section 16(a) of the Securities Exchange Act of 1934, as amended, are
included in the Proxy Statement for the Annual Meeting of Shareholders of Viad to be held on May 21, 2015, under
the captions “Election of Directors,” “Board of Directors and Corporate Governance” and “Information on Stock
Ownership,” and are incorporated herein by reference. Information regarding executive officers of Viad is located
in Part I, “Other - Executive Officers of Registrant” of this Annual Report.
Viad has adopted a Code of Ethics for all directors, officers and employees of the Company and its subsidiaries.
A copy of the Company’s Code of Ethics is available at Viad’s website at www.viad.com/pdf/corpgovernance/
CodeofEthics.pdf and is also available without charge to any shareholder upon request by writing to: Viad Corp,
1850 North Central Avenue, Suite 1900, Phoenix, Arizona 85004-4565, Attention: Corporate Secretary.
Item 11. Executive Compensation.
Information regarding executive compensation is contained in the Proxy Statement for the Annual Meeting
of Shareholders of Viad to be held on May 21, 2015, under the captions “Compensation Discussion and Analysis,”
“Board of Directors and Corporate Governance” and “Executive Compensation,” and is incorporated herein by
reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
Information regarding security ownership of certain beneficial owners and management and information
regarding securities authorized for issuance under equity compensation plans are contained in the Proxy Statement
for the Annual Meeting of Shareholders of Viad to be held on May 21, 2015, under the captions “Executive
Compensation” and “Information on Stock Ownership,” and is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
Information regarding director independence, and certain relationships and related transactions, is contained
in the Proxy Statement for the Annual Meeting of Shareholders of Viad to be held on May 21, 2015, under the
caption “Board of Directors and Corporate Governance,” and is incorporated herein by reference.
Item 14. Principal Accounting Fees and Services.
Information regarding principal accounting fees and services and the pre-approval policies and procedures
for such fees and services, as adopted by the Audit Committee of the Board of Directors, is contained in the Proxy
Statement for the Annual Meeting of Shareholders of Viad to be held on May 21, 2015, under the caption
“Ratification of the Appointment of Deloitte & Touche LLP as Viad’s Independent Public Accountants for 2015”
and is incorporated herein by reference.
45
Item 15. Exhibits, Financial Statement Schedules.
PART IV
(a)
1. The financial statements listed in the accompanying Index to Financial Statements are filed as part
of this Annual Report.
2. The exhibits listed in the accompanying Exhibit Index are filed as part of this Annual Report.
(b)
Exhibits
See Exhibit Index.
(c)
Financial Statement Schedules
Schedule II – Valuation and Qualifying Accounts.
46
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant
has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in
Phoenix, Arizona, on March 12, 2015.
VIAD CORP
By:
/s/ Steven W. Moster
Steven W. Moster
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report has been signed
below by the following persons on behalf of Viad Corp and in the capacities and on the dates indicated:
Date: March 12, 2015
Date: March 12, 2015
Date: March 12, 2015
Date: March 12, 2015
47
Principal Executive Officer
By:
/s/ Steven W. Moster
Steven W. Moster
President and Chief Executive
Officer
Principal Financial Officer
By:
/s/ Ellen M. Ingersoll
Ellen M. Ingersoll
Chief Financial Officer
Principal Accounting Officer
By:
/s/ Leslie S. Striedel
Leslie S. Striedel
Chief Accounting Officer
Directors
Andrew B. Benett
Daniel Boggan Jr.
Isabella Cunningham
Richard H. Dozer
Edward E. Mace
Robert E. Munzenrider
Margaret E. Pederson
Albert M. Teplin
By:
/s/ Ellen M. Ingersoll
Ellen M. Ingersoll
Attorney-in-Fact
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of Viad Corp (“Viad” or the “Company”) is responsible for establishing and maintaining
adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15
(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the
supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s
board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with accounting
principles generally accepted in the United States of America and includes those policies and procedures that:
•
•
•
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions
and dispositions of the assets of the Company;
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with accounting principles generally accepted in the United States of America,
and that receipts and expenditures of the Company are being made only in accordance with authorizations
of management and directors of the Company; and
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or
disposition of the Company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls
may become inadequate because of changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations.
Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to
financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a
risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial
reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it
is possible to design into the process safeguards to reduce, though not eliminate, this risk.
Management performed an assessment of the effectiveness of Viad’s internal control over financial reporting
using the criteria described in the “Internal Control - Integrated Framework (2013),” issued by the Committee of
Sponsoring Organizations of the Treadway Commission. The objective of this assessment was to determine whether
Viad’s internal control over financial reporting was effective as of December 31, 2014.
In accordance with the SEC's published guidance, our management has excluded from its assessment the
internal control over financial reporting at Blitz, onPeak and N200, which we acquired on September 16, 2014,
October 7, 2014 and November 24, 2014, respectively, and whose financial statements constitute 19.3% of total
assets and 1.6% of revenues of our consolidated financial statement amounts as of and for the year ended December
31, 2014.
Based on its assessment, management concluded that, as of December 31, 2014, Viad’s internal control over
financial reporting is effective based on those criteria.
Viad’s independent registered public accounting firm, Deloitte & Touche LLP, has issued a report relating
to its audit of the effectiveness of Viad’s internal control over financial reporting, which appears on the following
page of this Annual Report.
48
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Directors and Stockholders of
Viad Corp
Phoenix, Arizona
We have audited the internal control over financial reporting of Viad Corp and subsidiaries (the “Company”) as of
December 31, 2014, based on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission. As described in Management’s Report on Internal Control over
Financial Reporting, management excluded from its assessment the internal control over financial reporting at Blitz, onPeak
and N200, which were acquired on September 16, 2014, October 7, 2014 and November 24, 2014, respectively, and whose
financial statements constitute 19.3% of total assets and 1.6% of revenues of the consolidated financial statement amounts as
of and for the year ended December 31, 2014. Accordingly, our audit did not include the internal control over financial reporting
at Blitz, onPeak and N200. The Company’s management is responsible for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying
Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s
internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding
of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design
and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s
principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s
board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of
the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that
could have a material effect on the financial statements.
Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or
improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on
a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future
periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as
of December 31, 2014, based on the criteria established in Internal Control - Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, 2014
of the Company and our report dated March 12, 2015 expressed an unqualified opinion on those consolidated financial statements
and financial statement schedule.
/s/ DELOITTE & TOUCHE LLP
Deloitte & Touche LLP
Phoenix, Arizona
March 12, 2015
49
INDEX TO FINANCIAL STATEMENTS
Consolidated Balance Sheets .....................................................................................................................
Consolidated Statements of Operations .....................................................................................................
Consolidated Statements of Comprehensive Income ................................................................................
Consolidated Statements of Stockholders’ Equity .....................................................................................
Consolidated Statements of Cash Flows....................................................................................................
Notes to Consolidated Financial Statements..............................................................................................
Report of Independent Registered Public Accounting Firm ......................................................................
Schedule II – Valuation and Qualifying Accounts .....................................................................................
Page
F-1
F-2
F-3
F-4
F-5
F-6
F-49
F-50
50
VIAD CORP
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
Current assets
Assets
Cash and cash equivalents
Accounts receivable, net of allowance for doubtful accounts of $1,258 and $877,
respectively
Inventories
Deferred income taxes
Other current assets
Total current assets
Property and equipment, net
Other investments and assets
Deferred income taxes
Goodwill
Other intangible assets, net
Total Assets
Current liabilities
Liabilities and Stockholders’ Equity
Accounts payable
Customer deposits
Accrued compensation
Other current liabilities
Current portion of long-term debt and capital lease obligations
Total current liabilities
Long-term debt and capital lease obligations
Pension and postretirement benefits
Other deferred items and liabilities
Total liabilities
Commitments and contingencies
Stockholders’ equity
Viad Corp stockholders’ equity:
Common stock, $1.50 par value, 200,000,000 shares authorized, 24,934,981 shares
issued
Additional capital
Retained deficit
Unearned employee benefits and other
Accumulated other comprehensive income (loss):
Unrealized gain on investments
Cumulative foreign currency translation adjustments
Unrecognized net actuarial loss and prior service credit, net
Common stock in treasury, at cost, 4,842,621 and 4,618,433 shares, respectively
Total Viad Corp stockholders’ equity
Noncontrolling interest
Total stockholders’ equity
Total Liabilities and Stockholders’ Equity
December 31,
2014
2013
$
56,990
$
45,821
78,121
32,401
22,943
17,440
207,895
199,571
40,674
29,639
194,197
42,967
714,943
61,789
32,720
20,736
27,787
27,856
170,888
113,164
33,427
49,762
367,241
37,402
582,066
(36,427)
23
471
12,416
(13,476)
(247,088)
335,387
12,315
347,702
714,943
$
$
$
61,197
27,993
20,577
17,142
172,730
190,330
35,026
29,823
129,543
4,480
561,932
40,941
29,207
15,113
29,169
10,903
125,333
765
30,672
48,619
205,389
37,402
590,862
(50,393)
(21)
429
30,847
(11,259)
(250,426)
347,441
9,102
356,543
561,932
$
$
$
Refer to Notes to Consolidated Financial Statements.
F-1
VIAD CORP
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended December 31,
2014
2013
2012
(in thousands, except per share data)
Revenues:
Exhibition and event services
Exhibits and environments
Travel and recreation services
Total revenues
Costs and expenses:
Costs of services
Costs of products sold
Gain on sale of facility and related land
Corporate activities
Interest income
Interest expense
Restructuring charges
Goodwill impairment charge
Other impairment charges
Total costs and expenses
$
772,770
$
685,350
$
171,698
120,519
1,064,987
843,652
161,469
—
14,348
(305)
2,015
1,637
—
884
159,554
108,443
953,347
758,466
157,745
(4,775)
6,755
(550)
1,234
3,793
2,097
952
1,023,700
925,717
Income from continuing operations before income taxes
Income tax expense
Income from continuing operations
Income from discontinued operations
Net income
Net income attributable to noncontrolling interest
Net income attributable to Viad
Diluted income per common share:
Continuing operations attributable to Viad common stockholders
Discontinued operations attributable to Viad common stockholders
Net income attributable to Viad common stockholders
Weighted-average outstanding and potentially dilutive common shares
Basic income per common share:
Continuing operations attributable to Viad common stockholders
Discontinued operations attributable to Viad common stockholders
Net income attributable to Viad common stockholders
Weighted-average outstanding common shares
Dividends declared per common share
Amounts attributable to Viad common stockholders
Income from continuing operations
Income from discontinued operations
Net income
$
$
$
$
$
$
$
$
41,287
109
41,178
14,389
55,567
(3,213)
52,354
2.02
0.57
2.59
20,133
2.02
0.57
2.59
19,804
1.90
40,790
11,564
52,354
$
$
$
$
$
$
$
$
27,630
8,310
19,320
2,366
21,686
(131)
21,555
0.96
0.10
1.06
20,265
0.96
0.10
1.06
19,850
2.90
19,437
2,118
21,555
$
$
$
$
$
$
$
$
Refer to Notes to Consolidated Financial Statements.
F-2
726,429
175,611
104,604
1,006,644
803,921
164,532
—
9,408
(593)
1,303
4,942
—
—
983,513
23,131
19,578
3,553
3,030
6,583
(686)
5,897
0.17
0.12
0.29
20,005
0.17
0.12
0.29
19,701
0.28
3,348
2,549
5,897
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
VIAD CORP
(in thousands)
Net income
Other comprehensive income:
Unrealized gains on investments, net of tax expense (benefit) of $26, $96 and
$33
Unrealized foreign currency translation adjustments, net of tax
Amortization of net actuarial gain (loss), net of tax expense (benefit) of
$(1,538), $2,380 and $(574)
Amortization of prior service credit (cost), net of tax expense (benefit) of
$339, $(327) and $(433)
Comprehensive income
Comprehensive income attributable to noncontrolling interest
Comprehensive income attributable to Viad
Year Ended December 31,
2014
2013
2012
$
55,567
$
21,686
$
6,583
42
154
(18,431)
(11,311)
53
7,510
(2,568)
4,244
(1,311)
351
34,961
(3,213)
(535)
(680)
14,238
12,155
(131)
(686)
$
31,748
$
14,107
$
11,469
Refer to Notes to Consolidated Financial Statements.
F-3
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-
F
VIAD CORP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Cash flows from operating activities
Net income
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
Deferred income taxes
Income from discontinued operations
Restructuring charges
Impairment charges
Gain on sale of facility and related land
Gains on dispositions of property and other assets
Share-based compensation expense
Excess tax benefit from share-based compensation arrangements
Other non-cash items, net
Change in operating assets and liabilities (excluding the impact of acquisitions):
Receivables
Inventories
Accounts payable
Restructuring liabilities
Accrued compensation
Customer deposits
Income taxes payable
Other assets and liabilities, net
Net cash provided by operating activities
Cash flows from investing activities
Proceeds from possessory interest and personal property - discontinued
operations
Proceeds from dispositions of property and other assets
Capital expenditures
Acquisition of businesses, net of cash acquired
Proceeds from sale of facility and related land
Proceeds from sale of land—discontinued operations
Proceeds from sale of short-term investments
Net cash used in investing activities
Cash flows from financing activities
Proceeds from borrowings
Payments on debt and capital lease obligations
Dividends paid on common stock
Common stock purchased for treasury
Debt issuance costs
Excess tax benefit from share-based compensation arrangements
Proceeds from exercise of stock options
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net change in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
Supplemental disclosure of cash flow information
Cash paid for income taxes
Cash paid for interest
Property and equipment acquired under capital leases
Property and equipment purchases in accounts payable and accrued liabilities
$
$
$
$
$
Year Ended December 31,
2013
2012
2014
$
55,567
$
21,686
$
6,583
30,792
(9,731)
(14,389)
1,637
884
—
(958)
2,930
(114)
5,386
(10,441)
(2,555)
18,128
(5,276)
3,663
(6,406)
1,543
(12,570)
58,090
28,000
1,109
(29,389)
(120,251)
—
—
—
(120,531)
189,512
(61,461)
(38,387)
(12,321)
(1,671)
114
1,155
76,941
(3,331)
11,169
45,821
56,990
8,389
1,703
881
780
$
$
$
$
$
27,967
2,298
(2,366)
3,793
3,049
(4,775)
(265)
5,221
(422)
4,870
1,246
7,663
(15,436)
(4,841)
(11,707)
(20,965)
218
(11,179)
6,055
—
464
(36,119)
(647)
12,696
1,645
—
(21,961)
20,000
(11,362)
(58,914)
(1,328)
—
422
777
(50,405)
(2,039)
(68,350)
114,171
45,821
8,498
1,006
832
3,204
$
$
$
$
$
30,133
11,274
(3,030)
4,942
—
—
(206)
7,232
(293)
10,157
142
195
4,310
(4,694)
1,631
926
467
(583)
69,186
—
322
(27,675)
(23,546)
—
1,041
384
(49,474)
—
(2,685)
(4,454)
(1,656)
—
293
248
(8,254)
2,337
13,795
100,376
114,171
8,386
1,103
1,011
4,822
Refer to Notes to Consolidated Financial Statements.
F-5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
VIAD CORP
Note 1. Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
The consolidated financial statements of Viad Corp (“Viad” or the “Company”) are prepared in conformity
with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts
of Viad and all of its subsidiaries. All intercompany account balances and transactions between Viad and its
subsidiaries have been eliminated in consolidation.
Nature of Business
Viad’s reportable segments consist of Marketing & Events U.S., Marketing & Events International and Travel
& Recreation Group.
Marketing & Events Group
The Marketing & Events Group, comprised of Global Experience Specialists, Inc. and affiliates (“GES”),
is a global event marketing company that helps clients gain more awareness, more involvement and more value
from their trade show programs and other live events. The Marketing & Events Group specializes in all aspects of
the design, planning and production of face-to-face events, immersive environments and brand-based experiences
for clients, including show organizers, corporate brand marketers and retail shopping centers. The mission of the
Marketing & Events Group is to create the world’s most meaningful and memorable experiences for show
organizers, brand marketers, event attendees and retail shopping centers. Show organizers include for-profit and
not-for-profit show owners as well as show management companies. Corporate brand marketers include exhibitors
and domestic and international corporations that want to promote their brands, services and innovations, feature
new products and build business relationships. Viad’s retail shopping center customers include major developers,
owners and management companies of shopping malls and leisure centers.
On September 16, 2014, the Company acquired Blitz Communications Group Limited and affiliates
(collectively, “Blitz”), which has offices in the United Kingdom and is a leading audio-visual staging and creative
services provider for the live events industry in the United Kingdom and continental Europe. The purchase price
was £15 million (approximately $24.4 million) in cash, subject to certain adjustments.
On October 7, 2014, the Company acquired onPeak LLC and Travel Planners, Inc. (collectively, “onPeak”)
for a purchase price of $43.0 million and $33.7 million, respectively, in cash, subject to certain adjustments. Both
acquired companies provide event accommodations services in North America to the live events industry.
On November 24, 2014, the Company acquired N200 Limited and affiliates (collectively, “N200”) for €9.7
million (approximately $12.1 million) in cash, subject to certain adjustments, plus an earnout payment (the
“Earnout”) of up to €1.0 million. The amount of the Earnout is based on N200’s achievement of established financial
targets for fiscal 2015 (ending June 30). N200, which has offices in the United Kingdom and the Netherlands, is
a leading event registration and data intelligence services provider for the live events industry in the United Kingdom
and the Netherlands.
For additional information, refer to Note 3, Acquisition of Businesses.
Travel & Recreation Group
The Travel & Recreation Group is an experiential leisure travel provider serving the needs of regional and
long-haul visitors to iconic natural and cultural destinations in North America. The Travel & Recreation Group
consists of Brewster Inc. (“Brewster”), Glacier Park, Inc. (“Glacier Park”) and Alaskan Park Properties, Inc.
(“Alaska Denali Travel”). Brewster provides tourism products and experiential services in the Canadian Rockies
in Alberta and in other parts of Western Canada. Brewster’s operations include the Banff Gondola, Columbia
F-6
Icefield Glacier Adventure, Glacier Skywalk (opened May 2014), Banff Lake Cruise, motorcoach services, charter
and sightseeing services, inbound package tour operations and hotel operations.
Glacier Park, an 80 percent owned subsidiary of Viad, owns and operates seven lodges, with accommodation
offerings varying from hikers’ cabins to hotel suites, including St. Mary Lodge, a 115-room, full-service resort
lodge located outside the east entrance to Glacier National Park in St. Mary, Montana; Glacier Park Lodge, a
historic lodge in East Glacier, Montana; Grouse Mountain Lodge, a full-season lodge offering golf, skiing in the
winter, hiking in the summer and other seasonal recreational activities, located near Glacier National Park in
Whitefish, Montana; the Prince of Wales Hotel in Waterton Lakes National Park, Alberta, Canada, which is situated
on land for which the Company has a 42-year ground lease with the Canadian government running through January
31, 2052; the West Glacier Motel & Cabins in West Glacier, Montana, and Motel Lake McDonald and the Apgar
Village Lodge, which are located inside Glacier National Park. Glacier Park also operates the food and beverage
services with respect to those properties and the retail shops located near Glacier National Park. With regard to
Glacier Park’s concession operations within Glacier National Park, refer to Note 24, Discontinued Operations.
On July 1, 2014, the Company acquired the West Glacier Motel & Cabins, the Apgar Village Lodge and
related land, food and beverage services and retail operations (collectively, the “West Glacier Properties”). The
West Glacier Motel & Cabins is a 32-room property situated on approximately 200 acres at the west entrance of
Glacier National Park, and its full-service amenities include a restaurant, grocery store, gift shops, a gas station
and employee accommodations. The Apgar Village Lodge is a 48-room property situated on a 3.8 acre private in-
holding inside Glacier National Park with overnight accommodations, a gift shop and employee accommodations.
The purchase price was $16.5 million in cash with a working capital adjustment of $0.3 million, subject to certain
adjustments. For additional information, refer to Note 3, Acquisition of Businesses.
Alaska Denali Travel operates the Denali Backcountry Lodge and Denali Cabins. In addition to lodging,
Alaska Denali Travel also provides food and beverage operations and package tour and transportation services in
and around Denali National Park and Preserve.
Significant Accounting Policies
Use of Estimates. The preparation of financial statements in conformity with GAAP requires management
to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and
accompanying notes. These estimates and assumptions include, but are not limited to:
•
•
•
•
•
•
•
•
•
•
Fair value of Viad’s reporting units used to perform annual impairment testing of recorded goodwill;
Allowances for uncollectible accounts receivable;
Provisions for income taxes, including uncertain tax positions;
Valuation allowances related to deferred tax assets;
Liabilities for losses related to self-insured liability claims;
Liabilities for losses related to environmental remediation obligations;
Sublease income associated with restructuring liabilities;
Assumptions used to measure pension and postretirement benefit costs and obligations;
Assumptions used to determine share-based compensation costs under the fair value method and
Allocation of purchase price of acquired businesses.
Actual results could differ from these and other estimates.
Cash and Cash Equivalents. Viad considers all highly-liquid investments with remaining maturities when
purchased of three months or less to be cash equivalents. Viad’s cash and cash equivalents consist of cash and bank
demand deposits, bank time deposits and money market mutual funds. The Company’s investments in money
market mutual funds are classified as available-for-sale and carried at fair value.
Inventories. Inventories, which consist primarily of exhibit design and construction materials and supplies
used in providing convention show services, are stated at the lower of cost (first-in, first-out and specific
identification methods) or market.
F-7
Property and Equipment. Property and equipment are stated at cost, net of accumulated depreciation.
Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets:
buildings, 15 to 40 years; equipment, 3 to 12 years; and leasehold improvements, over the shorter of the lease term
or useful life. Property and equipment are tested for potential impairment whenever events or changes in
circumstances indicate that the carrying amount of the long-lived asset may not be recoverable through undiscounted
cash flows.
Capitalized Software. Viad capitalizes certain internal and external costs incurred in developing or obtaining
internal use software. Capitalized costs principally relate to costs incurred to purchase software from third parties,
external direct costs of materials and services, and certain payroll-related costs for employees directly associated
with software projects once application development begins. Costs associated with preliminary project activities,
training and other post-implementation activities are expensed as incurred. Capitalized software costs are amortized
using the straight-line method over the estimated useful lives of the software, ranging from three to ten years.
These costs are included in the consolidated balance sheets under the caption “Property and equipment, net.”
Goodwill. Goodwill is tested for impairment at the reporting unit level on an annual basis as of October 31
of each year. Goodwill is also tested for impairment between annual tests if an event occurs or circumstances
change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. Viad
uses a discounted expected future cash flow methodology (income approach) in order to estimate the fair value of
its reporting units for purposes of goodwill impairment testing. The estimates and assumptions regarding expected
future cash flows, discount rates and terminal values require considerable judgment and are based on market
conditions, financial forecasts, industry trends and historical experience. These estimates, however, have inherent
uncertainties and different assumptions could lead to materially different results.
Cash Surrender Value of Life Insurance. Viad has Company-owned life insurance contracts which are
intended to fund the cost of certain employee compensation and benefit programs. These contracts are carried at
cash surrender value, net of outstanding policy loans. The cash surrender value represents the amount of cash the
Company could receive if the policies were discontinued before maturity. The changes in the cash surrender value
of the policies, net of insurance premiums, are included as a component of “Costs of Services” in the consolidated
statements of operations.
Self-Insurance Liabilities. Viad is self-insured up to certain limits for workers’ compensation, automobile,
product and general liability, property loss and medical claims. Viad has also retained certain liabilities related to
workers’ compensation and general liability insurance claims in conjunction with previously sold operations.
Provisions for losses for claims incurred, including estimated claims incurred but not yet reported, are made based
on Viad’s prior historical experience, claims frequency and other factors. Viad has purchased insurance for amounts
in excess of the self-insured levels.
Environmental Remediation Liabilities. Viad has retained certain liabilities representing the estimated cost
of environmental remediation obligations primarily associated with previously sold operations. The amounts
accrued primarily consist of the estimated direct incremental costs, on an undiscounted basis, for contractor and
other services related to remedial actions and post-remediation site monitoring. Environmental remediation
liabilities are recorded when the specific obligation is considered probable and the costs are reasonably estimable.
Subsequent recoveries from third parties, if any, are recorded through discontinued operations when realized.
Fair Value of Financial Instruments. The carrying values of cash and cash equivalents, receivables and
accounts payable approximate fair value due to the short-term maturities of these instruments. The estimated fair
value of debt obligations is disclosed in Note 11, Debt.
Foreign Currency Translation. Viad conducts its foreign operations primarily in Canada, the United
Kingdom, Germany and to a lesser extent in certain other countries. The functional currency of Viad’s foreign
subsidiaries is their local currency. Accordingly, for purposes of consolidation, Viad translates the assets and
liabilities of its 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
F-8
are included as a component of accumulated other comprehensive income in Viad’s consolidated balance sheets.
In addition, for purposes of consolidation, the revenues, expenses and gains and losses related to Viad’s foreign
operations are translated into U.S. dollars at the average foreign exchange rates for the period.
Revenue Recognition. Viad recognizes revenue when persuasive evidence of an arrangement exists, delivery
has occurred or services have been rendered, the sales price is fixed or determinable and collectability is reasonably
assured. GES derives revenues primarily by providing show services to exhibitors participating in exhibitions and
events and from the design, construction and refurbishment of exhibit booths and holiday themed environments.
Service revenue is recognized at the time services are completed. Service revenue from event accommodations
services is recorded when services are completed and is net of commissions. Exhibits and environments revenue
is accounted for using the completed-contract method. The Travel & Recreation Group generates revenues through
its attractions, hotels and transportation and sightseeing services. Revenues are recognized at the time services are
performed.
Share-Based Compensation. Viad recognizes and measures compensation costs related to all share-based
payment awards using the fair value method of accounting. These awards generally include restricted stock,
performance-based restricted stock (“PBRS”), stock options and liability-based awards (including performance
units, restricted stock units and performance-based restricted stock units). These awards contain forfeiture and
non-compete provisions.
The fair value of restricted stock and PBRS awards are based on Viad’s stock price on the date of grant. Viad
issues restricted stock and PBRS awards from shares held in treasury. Future vesting of restricted stock and PBRS
is generally subject to continued employment with Viad or its subsidiaries. Holders of restricted stock and PBRS
have the right to receive dividends and vote the shares, but may not sell, assign, transfer, pledge or otherwise
encumber the stock, except to the extent restrictions have lapsed.
Restricted stock awards vest between three and five years from the date of grant. Share-based compensation
expense related to restricted stock is recognized using the straight-line method over the requisite service period of
approximately three years except for certain awards with a five-year vesting period whereby expense is recognized
based on an accelerated multiple-award approach over a five-year period. For these awards, 40 percent of the shares
vest on the third anniversary of the grant and the remaining shares vest in 30 percent increments over the subsequent
two anniversary dates.
Liability-based awards (including performance units, restricted stock units and PBRS units awarded to key
employees at certain of the Company’s Canadian operations) are recorded at estimated fair value, based on the
number of units expected to vest and the level of achievement of predefined performance goals (where applicable)
and are remeasured on each balance sheet date based on Viad’s stock price or the Monte Carlo simulation method
until the time of settlement. The fair value of performance-based awards based on a market condition is determined
using a Monte Carlo simulation. A Monte Carlo simulation requires the use of a number of assumptions, including
historical volatility and correlation of the price of Viad’s stock and the price of the common shares of a comparator
group, a risk-free rate of return and an expected term. To the extent earned, liability-based awards are settled in
cash based on Viad’s stock price. Compensation expense related to liability-based awards is recognized ratably
over the requisite service period of approximately three years.
Share-based compensation expense related to PBRS awards is recognized based on an accelerated multiple-
award approach over the requisite service period of approximately three years. PBRS vests when certain incentive
performance targets established in the year of grant are achieved at target levels. PBRS is subject to a graded
vesting schedule whereby one third of the earned shares vest after the first year and the remaining earned shares
vest in one-third increments each year over the next two years on the first business day in January.
The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option
pricing model. Share-based compensation expense related to stock option awards is recognized using the straight-
line method over the requisite service period of approximately five years. The exercise price of stock options is
based on the market value of Viad’s common stock at the date of grant.
F-9
Common Stock in Treasury. Common stock purchased for treasury is recorded at historical cost. Subsequent
share reissuances are primarily related to share-based compensation programs and recorded at weighted-average
cost.
Income Per Common Share. Viad applies the two-class method in calculating income per common share
as unvested share-based payment awards that contain nonforfeitable rights to dividends are considered participating
securities. Accordingly, such securities are included in the earnings allocation in calculating income per share.
Historically, Viad has funded its matching contributions to employees’ 401(k) accounts through the Company’s
leveraged Employee Stock Ownership Plan (“ESOP”) feature of the Company’s 401(k) defined contribution plan.
ESOP shares are treated as outstanding for income per share calculations. During 2014, the Company depleted
these shares and matching contributions are now funded from shares of Viad common stock held in treasury.
Impact of Recent Accounting Pronouncements
In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and
Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of
Components of an Entity. The new guidance changes the criteria for reporting discontinued operations while
enhancing disclosures. Under the standard, only disposals representing a strategic shift in operations, such as a
disposal of a major geographic area, a major line of business or a major equity method investment, may be presented
as discontinued operations. This guidance is effective for interim and annual periods beginning after December
15, 2014 and is not expected to have a material impact on Viad’s financial condition or results of operations.
In May 2014, the FASB issued ASU No. 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 guidance is effective for fiscal years beginning after December 15, 2016,
and early adoption is not permitted. The Company has not yet determined if the adoption of this new guidance will
have a material impact on its financial position or results of operations.
In June 2014, the FASB issued ASU No. 2014-12, Compensation - Stock Compensation (Topic 718):
Accounting for Share-Based Payments When the Terms of an Award Provide that a Performance Target Could be
Achieved after the Requisite Service Period. The new guidance requires that a performance target that affects
vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As
such, the performance target should not be reflected in estimating the grant date fair value of the award. This update
is effective for our fiscal year beginning January 1, 2016 and early adoption is permitted. The adoption of this new
guidance is not expected to have a material impact on Viad’s financial condition or results of operations.
Note 2. Share-Based Compensation
Viad grants share-based compensation awards to officers, directors and certain key employees pursuant to
the 2007 Viad Corp Omnibus Incentive Plan (the “2007 Plan”). The 2007 Plan has a 10-year life and provides for
the following types of awards: (a) incentive and non-qualified stock options; (b) restricted stock and restricted
stock units; (c) performance units or performance shares; (d) stock appreciation rights; (e) cash-based awards and
(f) certain other stock-based awards. The number of shares of common stock available for grant under the 2007
Plan is limited to 1.7 million shares plus shares awarded under the 1997 Viad Corp Omnibus Incentive Plan (which
terminated in May 2007) (the “1997 Plan”) that subsequently cease for any reason to be subject to such awards
(other than by reason of exercise or settlement of the awards to the extent the shares are exercised for, or settled
in, vested and non-forfeited shares) up to an aggregate maximum of 1.5 million shares. As of December 31, 2014,
there were 889,254 total shares available for future grant.
F-10
The following table summarizes share-based compensation expense:
(in thousands)
Restricted stock/PBRS
Performance unit incentive plan (“PUP”)
Restricted stock units/PBRS units
Stock options
Total share-based compensation before income tax benefit
Income tax benefit
Total share-based compensation, net of income tax benefit
2014
2013
2012
2,495
359
76
—
2,930
(1,102)
1,828
$
$
3,073
1,864
177
107
5,221
(1,936)
3,285
$
$
3,267
2,922
450
593
7,232
(2,574)
4,658
$
$
In addition, $0.1 million of benefits and $0.7 million and $0.3 million of costs associated with share-based
compensation were included in restructuring expense in 2014, 2013 and 2012, respectively. The 2014 amount of
$0.1 million related to reversal of expense of PUP awards. Of the 2013 amount, $0.3 million related to the restricted
stock units and PUP awards presented below. Similarly, of the 2012 amount, $0.1 million related to PUP awards.
No share-based compensation costs were capitalized during 2014, 2013 or 2012.
On January 24, 2014 and October 25, 2013, Viad announced that its Board of Directors declared special cash
dividends of $1.50 and $2.50 per share, respectively, to shareholders of record at the close of business on February
7, 2014 and November 7, 2013, respectively. In accordance with the mandatory provisions of the 2007 Plan and
the 1997 Plan, the Human Resources Committee of Viad’s Board of Directors approved equitable adjustments to
outstanding long-term incentive awards of stock options and PUP awards issued pursuant to those plans in order
to prevent the special dividends from diluting the rights of participants under those plans. The equitable adjustments
to the outstanding stock options reduced the exercise price and increased the number of shares of common stock
underlying such options. The equitable adjustment to the PUP awards reflects the effect of the special dividends,
but would be paid only if certain performance goals are met at the end of the 3-year performance period.
Restricted Stock and PBRS. The following table summarizes restricted stock and PBRS activity:
Balance at December 31, 2011
Granted
Vested
Forfeited
Balance, December 31, 2012
Granted
Vested
Forfeited
Balance, December 31, 2013
Granted
Vested
Forfeited
Balance, December 31, 2014
Restricted Stock
PBRS
Weighted-
Average
Grant Date
Fair Value
20.36
20.46
18.26
24.80
21.25
27.27
20.83
22.13
22.78
23.79
22.51
23.13
23.30
Shares
572,022
$
168,050
(219,571)
(4,150)
516,351
101,300
(166,320)
(20,432)
430,899
128,700
(197,671)
(33,326)
328,602
Weighted-
Average
Grant Date
Fair Value
15.36
—
15.36
—
—
—
—
—
—
—
—
Shares
416
$
—
(416)
—
—
—
—
—
—
—
—
—
—
The grant date fair value of restricted stock which vested during 2014, 2013 and 2012 was $4.5 million, $3.5
million and $4.0 million, respectively. The grant date fair value of PBRS which vested during 2012 was
F-11
approximately $6,000. No PBRS vested during 2013 and 2014. As of December 31, 2014, the unamortized cost
of all outstanding 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 2014, 2013 and 2012, the Company
withheld 72,996 shares at a cost of $1.8 million, 50,156 shares at a cost of $1.3 million and 56,885 shares at a cost
of $1.1 million, respectively, related to tax withholding requirements on vested share-based awards.
Liability-Based Awards. The following table summarizes the liability-based award activity:
Balance at December 31, 2011
Granted
Vested
Forfeited
Balance, December 31, 2012
Granted
Vested
Forfeited
Balance, December 31, 2013
Granted
Vested
Forfeited
Balance, December 31, 2014
PUP Awards
Restricted Stock Units
PBRS Units
Weighted-
Average
Grant Date
Fair Value
23.02
$
20.60
—
—
21.70
27.35
—
21.15
23.46
23.71
23.01
24.43
23.51
Units
95,500
115,100
—
—
210,600
93,100
—
(3,932)
299,768
123,300
(94,600)
(61,348)
267,120
Weighted-
Average
Grant Date
Fair Value
19.07
$
20.57
15.36
20.89
20.82
27.35
19.10
22.55
22.91
24.87
23.45
27.32
23.17
Units
38,600
15,850
(13,100)
(850)
40,500
8,600
(11,300)
(9,240)
28,560
7,200
(9,890)
(500)
25,370
Weighted-
Average
Grant Date
Fair Value
15.36
$
—
15.36
—
—
—
—
—
—
—
—
—
Units
1,956
—
(1,956)
—
—
—
—
—
—
—
—
—
—
As of December 31, 2014 and 2013, Viad had liabilities recorded of $3.5 million and $5.9 million,
respectively, related to PUP awards. In March 2014, the PUP units granted in 2011 vested and cash payouts totaling
$2.9 million were distributed. There were no cash settlements of PUP awards during 2013 or 2012. As of
December 31, 2014 and 2013, Viad had aggregate liabilities recorded of $0.5 million and $0.7 million, respectively,
related to restricted stock unit liability awards. In February 2014, portions of the 2009, 2010 and 2011 restricted
stock unit awards vested and cash payouts totaling $0.2 million were distributed. Similarly, in February 2013 and
2012, portions of the 2009 and 2010 restricted stock unit awards vested and cash payouts of $0.3 million and $0.3
million were distributed, respectively. A portion of the 2009 PBRS unit awards vested effective December 31, 2009
and a cash payout of $35,000 was distributed in January 2012. As previously discussed above, the equitable
adjustment to the PUP awards reflects the effect of the special dividends, but would be paid only if certain
performance goals are met at the end of the 3-year performance period. This adjustment to the PUP awards did
not impact the compensation expense recognized by the Company for the years ended December 31, 2014 and
2013, or the unrecognized cost.
F-12
Stock Options. The following table summarizes stock option activity:
Options outstanding at December 31, 2011
Exercised
Forfeited or expired
Options outstanding at December 31, 2012
Exercised
Forfeited or expired(1)
Award modification
Options outstanding at December 31, 2013
Exercised
Forfeited or expired
Award modification
Options outstanding at December 31, 2014
(1) This includes the reversal of previously canceled stock options.
Shares
584,201
(12,099)
(208,206)
363,896
(59,543)
(15,853)
25,823
314,323
(66,076)
(18,522)
17,865
247,590
Weighted-
Average
Exercise Price
23.32
$
19.41
25.81
22.03
19.42
40.45
N/A
19.79
18.53
35.28
N/A
17.82
Options
Exercisable
396,688
276,009
314,323
247,590
As of December 31, 2014, there were no unrecognized costs related to non-vested stock option awards. No
stock options were granted in 2014, 2013 or 2012. As previously discussed above, the equitable adjustments to
the outstanding stock options resulting from the special cash dividends paid on February 14, 2014 and November
14, 2013 reduced the exercise price and increased the number of shares of common stock underlying such options.
This adjustment to the exercise price and the number of shares did not impact the compensation expense recognized
by the Company for the years ended December 31, 2014 and 2013, or the unrecognized cost.
The following table summarizes information concerning stock options outstanding and exercisable as of
December 31, 2014:
Range of Exercise Prices:
$16.62
$29.27
$16.62 to $29.27
Options Outstanding
Options Exercisable
Weighted-
Average
Remaining
Contractual Life
(in years)
3.8
0.2
3.5
Shares
224,137
23,453
247,590
Weighted-
Average
Exercise Price
16.62
$
29.27
17.82
Shares
224,137
23,453
247,590
Weighted-
Average
Exercise Price
16.62
$
29.27
17.82
Additional information pertaining to stock options is provided in the table below:
(in thousands)
Total intrinsic value of stock options outstanding
Total intrinsic value of stock options exercised
Fair value of stock options vested
Cash received from the exercise of stock options
Tax benefits realized for tax deductions related to stock option
exercises and performance-based awards
$
$
$
$
$
2014
2013
2012
2,251
1,616
$
$
— $
$
1,155
2,723
1,611
532
777
461
$
404
$
$
$
$
$
2,329
296
539
248
96
The aggregate intrinsic value of stock options outstanding in the table above represents the difference between
Viad’s closing stock price on December 31 of each year and the exercise price, multiplied by the number of in-
the-money options. The intrinsic value of stock options outstanding therefore changes based on changes in the fair
market value of Viad’s common stock.
F-13
Note 3. Acquisition of Businesses
West Glacier Properties
On July 1, 2014, the Company acquired the West Glacier Properties. The West Glacier Motel & Cabins is a
32-room property situated on approximately 200 acres at the west entrance of Glacier National Park, and its full-
service amenities include a restaurant, grocery store, gift shops, a gas station and employee accommodations. The
Apgar Village Lodge is a 48-room property situated on a 3.8 acre private in-holding inside Glacier National Park
with overnight accommodations, a gift shop and employee accommodations. The purchase price was $16.5 million
in cash plus a working capital adjustment of $0.3 million, subject to certain adjustments. The working capital
adjustment relates to the true up of certain current assets and liabilities.
The following table summarizes the recording of the fair values of the assets acquired and liabilities assumed
as of the acquisition date. These amounts are subject to change within the measurement period as our working
capital adjustments are finalized.
(in thousands)
Purchase price paid as:
Cash
Working capital adjustment payable
Total purchase price
Fair value of net assets acquired:
Prepaid expenses
Inventory
Property and equipment, net
Intangible assets
Total assets acquired
Accrued liabilities
Customer deposits
Other liabilities
Total liabilities acquired
$
16,544
320
16,864
$
24
1,374
14,510
189
16,097
35
402
64
501
Total fair value of net assets acquired
Excess purchase price over fair value of net assets acquired (“goodwill”)
15,596
1,268
$
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 fair value of net assets acquired was recorded as goodwill. The goodwill is included
in the Travel & Recreation Group and the primary factor that contributed to the purchase price resulting in the
recognition of goodwill relates to future growth opportunities when combined with our other businesses. The
goodwill is deductible for tax purposes over a period of 15 years. The estimated values of current assets and
liabilities were based upon their historical costs on the date of acquisition due to their short-term nature. Transaction
costs associated with the acquisition of the West Glacier Properties were $0.2 million and are included in corporate
activities in Viad’s Condensed Consolidated Statements of Operations.
Identified intangible assets acquired in the the West Glacier Properties acquisition totaled $0.2 million and
consist primarily of favorable lease contracts. The weighted-average amortization period related to the definite
lived intangible assets is 3.5 years.
The results of operations of the West Glacier Properties have been included in Viad’s condensed consolidated
financial statements from the date of acquisition. During 2014, revenues of $4.6 million and operating income of
F-14
$1.5 million related to the West Glacier Properties have been included in Viad’s Condensed Consolidated Statements
of Operations.
Blitz
On September 16, 2014, the Company acquired Blitz, which has offices in the United Kingdom and is a
leading audio-visual staging and creative services provider for the live events industry in the United Kingdom and
continental Europe. The purchase price was £15 million (approximately $24.4 million) in cash, subject to certain
adjustments.
The following table summarizes the preliminary recording of the fair values of the assets acquired and
liabilities assumed as of the acquisition date. Due to the recent timing of the acquisition, we have not yet finalized
our purchase price allocation. These amounts are subject to change within the measurement period as assessment
of intangible assets and certain tax amounts are finalized.
(in thousands)
Purchase price paid as:
Cash
Cash acquired
Purchase price, net of cash acquired
Fair value of net assets acquired:
Accounts receivable, net
Inventory
Prepaid expenses
Property and equipment, net
Intangible assets
Total assets acquired
Accounts payable
Accrued liabilities
Customer deposits
Deferred tax liability
Revolving credit facility
Accrued dilapidations
Total liabilities acquired
$
24,416
(190)
24,226
$
264
433
410
5,902
8,708
15,717
1,232
2,246
199
241
488
589
4,995
Total fair value of net assets acquired
Excess purchase price over fair value of net assets acquired (“goodwill”)
10,722
13,504
$
Under the acquisition method of accounting, the preliminary 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 fair value of net assets acquired was recorded as goodwill. The goodwill
is included in the Marketing & Events International segment and the primary factor that contributed to a purchase
price resulting in the recognition of goodwill relates to future growth opportunities when combined with our other
businesses. The goodwill is deductible for tax purposes over a period of 15 years. The estimated values of current
assets and liabilities were based upon their historical costs on the date of acquisition due to their short-term nature.
Transaction costs associated with the acquisition of Blitz were $0.8 million and are included in corporate activities
in Viad’s Condensed Consolidated Statements of Operations.
Identified intangible assets acquired in the Blitz acquisition totaled $8.7 million and consist of customer
relationships, non-compete agreements and trade name. The weighted-average amortization period related to the
intangible assets is approximately 6.9 years.
F-15
The results of operations of Blitz have been included in Viad’s condensed consolidated financial statements
from the date of acquisition. During 2014, revenues of $10.1 million and operating income of $0.4 million related
to Blitz have been included in Viad’s Condensed Consolidated Statements of Operations.
onPeak LLC
On October 7, 2014, the Company acquired onPeak LLC for a purchase price of $43.0 million in cash, subject
to certain adjustments. Of the initial purchase price, $4.1 million was deposited at closing into escrow to secure
post-closing purchase price adjustments, resolution of certain tax matters and other indemnity claims. onPeak LLC
provides event accommodations services in North America to the live events industry.
The following table summarizes the preliminary recording of the fair values of the assets acquired and
liabilities assumed as of the acquisition date. Due to the recent timing of the acquisition, we have not yet finalized
our purchase price allocation. These amounts are subject to change within the measurement period as assessment
of intangible assets and certain tax amounts are finalized.
(in thousands)
Purchase price paid as:
Cash
Cash acquired
Purchase price, net of cash acquired
Fair value of net assets acquired:
Accounts receivable, net
Prepaid expenses
Property and equipment, net
Other non-current assets
Intangible assets
Total assets acquired
Accounts payable
Accrued liabilities
Customer deposits
Deferred tax liability
Other liabilities
Total liabilities acquired
$
42,950
(4,064)
38,886
$
4,008
640
2,450
309
14,300
21,707
738
3,341
4,225
1,614
309
10,227
Total fair value of net assets acquired
Excess purchase price over fair value of net assets acquired (“goodwill”)
11,480
27,406
$
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 fair value of net assets acquired was recorded as goodwill. The goodwill is included
in the Marketing & Events U.S. segment and the primary factor that contributed to a purchase price resulting in
the recognition of goodwill relates to future growth opportunities when combined with our other businesses.
Goodwill of $9.3 million is expected to be deductible for tax purposes over a period of 15 years. The estimated
values of current assets and liabilities were based upon their historical costs on the date of acquisition due to their
short-term nature. Transaction costs associated with the acquisition of onPeak were $0.5 million and are included
in corporate activities in Viad’s Condensed Consolidated Statements of Operations.
F-16
Identified intangible assets acquired in the onPeak acquisition totaled $14.3 million and consist primarily of
customer relationships and trade name. The weighted-average amortization period related to the definite lived
intangible assets is 9.9 years.
The results of operations of onPeak have been included in Viad’s condensed consolidated financial statements
from the date of acquisition. During 2014, revenues of $2.7 million and an operating loss of $0.7 million related
to onPeak have been included in Viad’s Condensed Consolidated Statements of Operations.
Travel Planners, Inc.
On October 7, 2014, the Company acquired Travel Planners, Inc. for a purchase price of $33.7 million in
cash less a working capital adjustment of $0.3 million, subject to certain adjustments. Of the purchase price, $8.8
million was deposited at closing into escrow to secure post-closing purchase price adjustments, resolution of certain
tax matters and other indemnity claims. An additional estimated amount of $1.3 million would be payable to Travel
Planners, Inc. upon election by the Company to treat the purchase as an asset acquisition for tax purposes. The
Company assumes the acquisition will be treated as an asset acquisition for tax purposes, but has not yet finalized
determination of the election. Travel Planners, Inc. provides event accommodations services in North America to
the live events industry.
The following table summarizes the preliminary recording of the fair values of the assets acquired and
liabilities assumed as of the acquisition date. Due to the recent timing of the acquisition, we have not yet finalized
our purchase price allocation. These amounts are subject to change within the measurement period as assessment
of intangible assets and certain tax amounts are finalized.
(in thousands)
Purchase price paid as:
Cash
Additional purchase price payable upon tax election
Working capital receivable
Cash acquired
Purchase price, net of cash acquired
Fair value of net assets acquired:
Accounts receivable, net
Prepaid expenses
Property and equipment, net
Intangible assets
Total assets acquired
Accounts payable
Accrued liabilities
Customer deposits
Other liabilities
Total liabilities acquired
$
33,674
1,300
(279)
(4,204)
30,491
$
1,450
120
93
15,000
16,663
488
1,557
4,525
128
6,698
Total fair value of net assets acquired
Excess purchase price over fair value of net assets acquired (“goodwill”)
9,965
20,526
$
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 fair value of net assets acquired was recorded as goodwill. The goodwill is included
in the Marketing & Events U.S. segment and the primary factor that contributed to a purchase price resulting in
the recognition of goodwill relates to future growth opportunities when combined with our other businesses. The
F-17
goodwill is deductible for tax purposes over a period of 15 years. The estimated values of current assets and
liabilities were based upon their historical costs on the date of acquisition due to their short-term nature. Transaction
costs associated with the acquisition of Travel Planners, Inc. were $0.5 million and are included in corporate
activities in Viad’s Condensed Consolidated Statements of Operations.
Identified intangible assets acquired in the Travel Planners, Inc. acquisition totaled $15.0 million and consist
primarily of customer relationships, favorable lease contracts and trade name. The weighted-average amortization
period related to the definite lived intangible assets is 10.1 years.
The results of operations of Travel Planners, Inc. have been included in Viad’s condensed consolidated
financial statements from the date of acquisition. During 2014, revenues of $3.4 million and operating income of
$0.5 million related to Travel Planners, Inc. have been included in Viad’s Condensed Consolidated Statements of
Operations.
N200
On November 24, 2014, the Company acquired N200 Limited and affiliates (collectively, “N200”) for €9.7
million (approximately $12.1 million) in cash, subject to certain adjustments, plus an earnout payment (the
“Earnout”) of up to €1.0 million. The amount of the Earnout is based on N200’s achievement of established financial
targets for fiscal 2015 (ending June 30). Such contingent payment, if any, will be paid during the third quarter of
2015. N200, which has offices in the United Kingdom and the Netherlands, is a leading event registration and data
intelligence services provider for the live events industry in the United Kingdom and the Netherlands.
The following table summarizes the preliminary recording of the fair values of the assets acquired and
liabilities assumed as of the acquisition date. Due to the recent timing of the acquisition, we have not yet finalized
our purchase price allocation. These amounts are subject to change within the measurement period as assessment
of intangible assets, contingent consideration, working capital and certain tax amounts are finalized.
(in thousands)
Purchase price paid as:
Cash
Contingent consideration
Cash acquired
Purchase price, net of cash acquired
Fair value of net assets acquired:
Accounts receivable, net
Inventory
Prepaid expenses
Property and equipment, net
Intangible assets
Total assets acquired
Accounts payable
Accrued liabilities
Customer deposits
Deferred tax liability
Other liabilities
Total liabilities acquired
$
12,068
1,244
(943)
12,369
$
1,747
46
115
1,280
3,595
6,783
421
990
569
891
106
2,977
Total fair value of net assets acquired
Excess purchase price over fair value of net assets acquired (“goodwill”)
3,806
8,563
$
F-18
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 fair value of net assets acquired was recorded as goodwill. The goodwill is included
in the Marketing & Events International segment and the primary factor that contributed to a purchase price resulting
in the recognition of goodwill relates to future growth opportunities when combined with our other businesses.
The goodwill is deductible for tax purposes over a period of 15 years. The estimated values of current assets and
liabilities were based upon their historical costs on the date of acquisition due to their short-term nature. Transaction
costs associated with the acquisition of N200 were $1.0 million and are included in corporate activities in Viad’s
Condensed Consolidated Statements of Operations.
Identified intangible assets acquired in the N200 acquisition totaled $3.6 million and consist primarily of
customer relationships. The weighted-average amortization period related to the definite lived intangible assets is
7.6 years.
The results of operations of N200 have been included in Viad’s condensed consolidated financial statements
from the date of acquisition. During 2014, revenues of $0.4 million and an operating loss of $0.2 million related
to N200 have been included in Viad’s Condensed Consolidated Statements of Operations.
Resource Creative Limited
In February 2013, Viad acquired the assets of Resource Creative Limited (“RCL”) for $0.6 million in cash.
RCL is a United Kingdom-based company specializing in providing creative graphic services to the exhibition,
events and retail markets throughout the United Kingdom and continental Europe. The purchase price was subject
to certain adjustments, plus a deferred payment of up to approximately £0.2 million, which was contingent upon
RCL’s achievement of certain net revenue targets between the acquisition date and December 31, 2014. RCL
exceeded the net revenue targets for the period ended December 31, 2014 and 2013 and, consequently, deferred
payment installments in the amount of $0.1 million (£0.1 million) and $0.2 million (£0.1 million), respectively,
were paid in January 2015 and March 2014, respectively.
Supplementary pro forma financial information
The following table summarizes the unaudited pro forma results of operations attributable to Viad, assuming
that the acquisitions above had each been completed on January 1, 2013:
(in thousands, except per share data)
Revenue
Depreciation and amortization
Income from continuing operations
Net income attributable to Viad
Diluted net income per share
Basic net income per share
2014
2013
$
1,109,629
$
1,015,275
38,452
44,360
55,557
2.76
2.76
38,981
15,317
17,510
0.86
0.86
Pro forma net income for the year ended December 31, 2014 was adjusted to exclude transaction costs
associated with the acquisitions of Blitz, West, onPeak, Travel Planners and N200, which totaled $3.0 million.
These costs were included in the pro forma net income for the year ended December 31, 2013.
F-19
Note 4. Inventories
The components of inventories as of December 31 were as follows:
(in thousands)
Raw materials
Work in process
Inventories
Note 5. Other Current Assets
Other current assets as of December 31 were as follows:
(in thousands)
Prepaid vendor payments
Prepaid insurance
Prepaid software maintenance
Income tax receivable
Prepaid taxes
Prepaid other
Other
Other current assets
Note 6. Property and Equipment
Property and equipment as of December 31 consisted of the following:
(in thousands)
Land and land interests
Buildings and leasehold improvements
Equipment and other
Gross property and equipment
Accumulated depreciation
Property and equipment, net
2014
2013
16,749
15,652
32,401
2014
2,689
2,170
1,934
1,869
1,416
4,427
2,935
17,440
$
$
$
$
14,825
13,168
27,993
2013
2,008
2,260
1,946
2,035
752
4,563
3,578
17,142
2014
2013
30,360
138,104
319,435
487,899
(288,328)
199,571
$
$
23,646
139,889
294,409
457,944
(267,614)
190,330
$
$
$
$
$
$
Included in the “Equipment and other” caption above are capitalized costs incurred in developing or obtaining
internal use software. The net carrying amount of capitalized software was $17.0 million and $13.9 million as of
December 31, 2014 and 2013, respectively.
Included in the “Land and land interests” caption above are certain leasehold interests in land within the
Travel & Recreation Group for which the Company is considered to have perpetual use rights. The carrying amount
of these leasehold interests was $9.1 million and $10.0 million at December 31, 2014 and 2013, respectively. These
land interests are not subject to amortization.
Depreciation expense was $28.1 million, $27.4 million and $30.0 million for 2014, 2013 and 2012,
respectively.
During 2014 and 2013, Viad recorded impairment charges of $0.9 million and $1.0 million at the Marketing &
Events Group primarily related to the write off of certain internally developed software. These impairment losses
are included in the consolidated statements of operations under the caption “Other impairment charges.”
F-20
Note 7. Other Investments and Assets
As of December 31 other investments and assets consisted of the following:
(in thousands)
Cash surrender value of life insurance
Self-insured liability receivable
Workers’ compensation insurance security deposits
Other
Total other investments and assets
Note 8. Goodwill and Other Intangible Assets
2014
2013
20,866
7,728
4,250
7,830
40,674
$
$
19,690
5,009
3,350
6,977
35,026
$
$
The changes in the carrying amount of goodwill were as follows:
(in thousands)
Balance at December 31, 2012
Goodwill impairment charge
Business acquisitions
Foreign currency translation adjustments
Balance at December 31, 2013
Acquisition of Blitz
Acquisition of the West Glacier Properties
Acquisition of onPeak LLC
Acquisition of Travel Planners, Inc.
Acquisition of N200
Foreign currency translation adjustments
Balance at December 31, 2014
$
$
Marketing &
Events U.S.
Marketing &
Events
International
Travel &
Recreation
Group
62,686
—
—
—
62,686
—
—
27,406
20,526
—
—
110,618
$
$
23,054
—
158
(601)
22,611
13,504
—
—
—
8,563
(2,457)
42,221
$
$
52,080
(4,461)
—
(3,373)
44,246
—
1,268
—
—
—
(4,156)
41,358
$
$
Total
137,820
(4,461)
158
(3,974)
129,543
13,504
1,268
27,406
20,526
8,563
(6,613)
194,197
The following table summarizes goodwill by reporting unit and segment as of December 31:
(in thousands)
Marketing & Events Group:
Marketing & Events U.S.
Marketing & Events International:
GES United Kingdom
GES Canada
Total Marketing & Events Group
Travel & Recreation Group:
Brewster
Alaska Denali Travel
Glacier Park
Total Travel & Recreation Group
Total Goodwill
2014
2013
$
110,618
$
62,686
34,396
7,825
152,839
36,906
3,184
1,268
41,358
194,197
$
14,049
8,562
85,297
41,062
3,184
—
44,246
129,543
$
Goodwill is reviewed for impairment annually in the fourth quarter, or more frequently if impairment
indicators arise. Goodwill is required to be tested for impairment between the annual tests if an event occurs or
F-21
circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying
value.
For impairment testing purposes, the goodwill related to the Marketing & Events U.S. segment is assigned
to and tested at the operating segment level. Furthermore, the goodwill related to the Marketing & Events
International segment is assigned to and tested based on the segment’s geographical operations. For the Marketing &
Events International segment the reporting units are GES United Kingdom and GES Canada. Brewster, Glacier
Park and Alaska Denali Travel are considered reporting units for goodwill impairment testing purposes within the
Travel & Recreation Group.
As a result of the Company’s most recent impairment analysis performed as of October 31, 2014, the excess
of the estimated fair value over the carrying value (expressed as a percentage of the carrying amounts) under step
one of the impairment test was 142 percent, 48 percent and 52 percent for each of the Marketing & Events Group
reporting units in the United States, the United Kingdom and Canada, respectively. For the Brewster, Glacier Park
and Alaska Denali Travel reporting units, the excess of the estimated fair value over the carrying value was 167
percent, 16 percent and 14 percent, respectively, as of the most recent impairment test.
As of December 31, 2014, Viad had cumulative goodwill impairment charges of $229.7 million since the
adoption of the goodwill impairment testing provisions of ASC Topic 350.
A summary of other intangible assets as of December 31, 2014 is presented below:
(in thousands)
Amortized intangible assets:
Customer contracts and relationships
Other
Total amortized intangible assets
Unamortized intangible assets:
Business licenses
Total
Gross Carrying
Value
Accumulated
Amortization
Net Carrying
Value
$
$
41,624
4,576
46,200
460
46,660
$
$
(2,961) $
(732)
(3,693)
—
(3,693) $
38,663
3,844
42,507
460
42,967
A summary of other intangible assets as of December 31, 2013 is presented below:
(in thousands)
Amortized intangible assets:
Customer contracts and relationships
Other
Total amortized intangible assets
Unamortized intangible assets:
Business licenses
Total
Gross Carrying
Value
Accumulated
Amortization
Net Carrying
Value
$
$
5,537
1,280
6,817
460
7,277
$
$
(2,521) $
(276)
(2,797)
—
(2,797) $
3,016
1,004
4,020
460
4,480
F-22
Intangible asset amortization expense for 2014, 2013 and 2012 was $2.7 million, $1.3 million and $0.7
million, respectively. The weighted-average amortization period of customer contracts and relationships and other
amortizable intangible assets is approximately 9.0 years and 3.8 years, respectively. Estimated amortization expense
related to amortized intangible assets for future years is expected to be as follows:
(in thousands)
2015
2016
2017
2018
2019
Thereafter
Note 9. Other Current Liabilities
As of December 31 other current liabilities consisted of the following:
(in thousands)
Continuing operations:
Self-insured liability
Accrued sales and use taxes
Accrued employee benefit costs
Accrued dividends
Accrued foreign income taxes
Accrued professional fees
Accrued restructuring
Other
Total continuing operations
Discontinued operations:
Self-insured liability
Environmental remediation liabilities
Other
Total discontinued operations
Total other current liabilities
$
$
$
$
$
$
$
$
7,585
6,765
5,915
4,942
4,546
12,754
2013
7,603
1,609
2,751
2,192
565
1,832
3,877
7,741
28,170
469
353
177
999
29,169
2014
6,297
3,624
3,215
2,107
2,370
1,228
1,154
6,861
26,856
173
350
408
931
27,787
$
$
F-23
Note 10. Other Deferred Liabilities
As of December 31 other deferred items and liabilities consisted of the following:
(in thousands)
Continuing operations:
Self-insured liability
Self-insured excess liability
Accrued compensation
Foreign deferred tax liability
Accrued restructuring
Other
Total continuing operations
Discontinued operations:
Environmental remediation liabilities
Self-insured liability
Accrued income taxes
Other
Total discontinued operations
Total other deferred items and liabilities
Note 11. Debt
2014
2013
$
$
13,525
7,728
6,824
2,135
555
7,904
38,671
4,395
4,327
1,119
1,250
11,091
49,762
$
$
12,307
5,009
8,349
1,989
1,919
7,552
37,125
4,666
4,489
1,085
1,254
11,494
48,619
Long-term debt as of December 31 was as follows:
(in thousands, except interest rates)
Revolving credit agreement, 2.4% (2014) and 2.2% (2013) weighted-average
interest rate at December 31
Capital lease obligations, 6.0% (2014) and 6.9% (2013) weighted-average
interest rate at December 31, due through 2018
Total debt
Current portion
Long-term debt and capital lease obligations
2014
2013
$
139,500
$
10,000
1,520
141,020
(27,856)
113,164
$
1,668
11,668
(10,903)
765
$
Effective December 22, 2014, Viad entered into a $300 million Amended and Restated Credit Agreement
(the “Credit Agreement”). The Credit Agreement amends and replaces in its entirety the Company’s $180 million
revolving credit facility under the Amended and Restated Credit Agreement dated as of May 18, 2011. The Credit
Agreement provides for a senior credit facility in the aggregate amount of $300 million, which consists of a $175
million revolving credit facility (the “Revolving Credit Facility”) and a $125 million term loan (the “Term Loan”).
Loans under the Credit Agreement have a maturity date of December 22, 2019, and proceeds from the loans made
under the Credit Agreement were used to refinance certain outstanding debt of the Company and will be used for
the Company’s general corporate purposes in the ordinary course of its business. Under the Credit Agreement, the
Revolving Credit Facility and/or the Term Loan may be increased up to an additional $100 million under certain
circumstances. If such circumstances are met, the Company may obtain the additional borrowings under the
Revolving Credit Facility, the Term Loan, or a combination of the two facilities. The Revolving Credit Facility
has a $40 million sublimit for letters of credit. Borrowings and letters of credit can be denominated in U.S. dollars,
Euros, Canadian dollars or British pounds.
Viad’s lenders have a first perfected security interest in all of the personal property of Viad, GES and GES
Event Intelligence Services, Inc., including 65 percent of the capital stock of top-tier foreign subsidiaries. Financial
F-24
covenants include a fixed charge coverage ratio of not less than 1.75 to 1.00, with a step-up to 2.00 to 1.00 for the
fiscal quarter ending June 30, 2016. Viad must maintain a leverage ratio of not greater than 3.00 to 1.00, with a
step-down to 2.75 to 1.00 for the fiscal quarter ending March 31, 2016 and a step-down to 2.50 to 1.00 for the
fiscal quarter ending March 31, 2017. As of December 31, 2014, the fixed charge coverage ratio was 2.61 to 1.00,
and the leverage ratio was 1.73 to 1.00. The terms of the Credit Agreement allow Viad to pay dividends or purchase
the Company’s common stock up to $20 million in the aggregate in any calendar year, with additional dividends,
share repurchases or distributions of stock permitted if the Company’s leverage ratio is less than or equal to 2.00
to 1.00, and the Liquidity Amount (defined as cash in the U.S. and Canada plus available revolver borrowings on
a pro forma basis) is not less than $100 million, and no default or unmatured default, as defined in the Credit
Agreement, exists. Significant other covenants include limitations on investments, additional indebtedness, sales/
leases of assets, acquisitions, consolidations or mergers and liens on property. As of December 31, 2014, Viad was
in compliance with all covenants.
As of December 31, 2014, Viad’s total debt of $141.0 million consisted of outstanding borrowings under
the Term Loan and Revolving Credit Facility of $125 million and $14.5 million, respectively, and capital lease
obligations of $1.5 million. As of December 31, 2014, Viad had $159.4 million of capacity remaining under its
Credit Facility reflecting outstanding letters of credit of $1.1 million and the outstanding balance under the
Revolving Credit Facility of $14.5 million.
Borrowings under the Revolving Credit Facility (of which GES and GES Event Intelligence Services, Inc.
are guarantors) are indexed to the prime rate or the London Interbank Offered Rate, plus appropriate spreads tied
to Viad’s leverage ratio. Commitment fees and letters of credit fees are also tied to Viad’s leverage ratio. The fees
on the unused portion of the Credit Facility are currently 0.35 percent annually.
As of December 31, 2014, Viad had certain obligations under guarantees to third parties on behalf of its
subsidiaries. These guarantees are not subject to liability recognition in the consolidated financial statements and
relate to leased facilities entered into by the Company’s subsidiary operations. The Company would generally be
required to make payments to the respective third parties under these guarantees in the event that the related
subsidiary could not meet its own payment obligations. The maximum potential amount of future payments that
Viad would be required to make under all guarantees existing as of December 31, 2014 would be $5.9 million.
These guarantees relate to leased facilities and expire through October 2017. There are no recourse provisions that
would enable Viad to recover from third parties any payments made under the guarantees. Furthermore, there are
no collateral or similar arrangements whereby Viad could recover payments.
Aggregate annual maturities of long-term debt and capital lease obligations as of December 31, 2014 are as
follows:
(in thousands)
2015
2016
2017
2018
2019
Total
Less: Amount representing interest
Present value of minimum lease payments
Revolving Credit
Agreement
Capital Lease
Obligations
$
$
27,000
18,750
18,750
18,750
56,250
139,500
$
$
937
507
211
3
—
1,658
(138)
1,520
The gross amount of assets recorded under capital leases as of December 31, 2014 was $3.5 million and
accumulated amortization was $2.1 million. As of December 31, 2013, the gross amount of assets recorded under
capital leases and accumulated amortization was $3.9 million and $2.1 million, respectively. The amortization
charges related to assets recorded under capital leases are included in depreciation expense. Refer to Note 6,
Property and Equipment.
F-25
The weighted-average interest rate on total debt was 4.0 percent, 4.2 percent and 8.5 percent for 2014, 2013
and 2012, respectively. The estimated fair value of total debt was $123.0 million and $11.5 million as of
December 31, 2014 and 2013, respectively. The fair value of debt was estimated by discounting the future cash
flows using rates currently available for debt of similar terms and maturity.
Note 12. Fair Value Measurements
The fair value of an asset or liability is defined as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the measurement date. The fair value
guidance requires an entity to maximize the use of quoted prices and other observable inputs and minimize the
use of unobservable inputs when measuring fair value, and also establishes a fair value hierarchy which prioritizes
the inputs to valuation techniques used to measure fair value as follows:
Level 1 - Quoted prices in active markets for identical assets or liabilities.
Level 2 - Observable inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly.
Level 3 - Unobservable inputs to the valuation methodology that are significant to the measurement of fair value.
Viad measures its money market mutual funds and certain other mutual fund investments at fair value on a
recurring basis using Level 1 inputs. The fair value information related to these assets is summarized in the following
tables:
(in thousands)
Assets:
Money market funds
Other mutual funds
Total assets at fair value on a recurring basis
Liabilities:
Earnout contingent consideration liability
Total liabilities at fair value on a recurring basis $
Fair Value Measurements at Reporting Date Using
Quoted Prices
in
Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
December 31,
2014
$
$
8,518
2,536
11,054
$
$
8,518
2,536
11,054
$
$
— $
—
— $
—
—
—
(1,210)
(1,210) $
—
— $
—
— $
(1,210)
(1,210)
(in thousands)
Assets:
Money market funds
Other mutual funds
Total assets at fair value on a recurring basis
Fair Value Measurements at Reporting Date Using
Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
December 31,
2013
$
$
118
2,023
2,141
$
$
118
2,023
2,141
$
$
— $
—
— $
—
—
—
As of December 31, 2014 and 2013, Viad had investments in money market mutual funds of $8.5 million
and $0.1 million, respectively, which are included in the consolidated balance sheets under the caption “Cash and
cash equivalents.” These investments are classified as available-for-sale and were recorded at fair value. There
have been no realized or unrealized gains or losses related to these investments and the Company has not experienced
any redemption restrictions with respect to any of the money market mutual funds.
F-26
As of December 31, 2014 and 2013, Viad had investments in other mutual funds of $2.5 million and $2.0
million, respectively, which are classified in the consolidated balance sheets under the caption “Other investments
and assets.” These investments were classified as available-for-sale and were recorded at fair value. As of
December 31, 2014 and 2013, there were unrealized gains of $0.8 million ($0.5 million after-tax) and $0.7 million
($0.4 million after-tax), respectively, which were included in the consolidated balance sheets under the caption
“Accumulated other comprehensive income (loss).”
The fair value measurement of the earn-out contingent consideration obligation relates to the acquisition
of N200 in November, and is included in accrued liabilities in the consolidated balance sheets. The fair value
measurement is based upon significant inputs not observable in the market. Changes in the value of the obligation
are recorded as income or expense in our consolidated statements of income. We estimated the original fair value
of the contingent consideration as the present value of the expected contingent payment, determined using the
weighted probabilities of the possible payments. We are required to reassess the fair value of the contingent payments
on a contingent basis. Significant increases (decreases) in any of those probabilities in isolation may result in a
higher (lower) fair value measurement. The significant inputs used in these estimates include numerous possible
scenarios for the payments based on the contractual terms of the contingent consideration, for which probabilities
are assigned to each scenario, which are then discounted using an appropriate discount rate commensurate with
the individual risk analysis of the respective liabilities. Although we believe our assumptions are reasonable,
different assumptions or changes in the future may result in different estimated amounts. The contingent payment,
if any, will be paid during the third quarter of 2015. A one percentage point change in the discount rates used would
not have significantly impacted the current liability as of December 31, 2014.
The carrying values of cash and cash equivalents, receivables and accounts payable approximate fair value
due to the short-term maturities of these instruments. The estimated fair value of debt obligations is disclosed in
Note 11, Debt.
Note 13. Income Per Share
The following are the components of basic and diluted income per share as of December 31:
(in thousands, except per share data)
Net income attributable to Viad (diluted)
Less: Allocation to non-vested shares
Net income allocated to Viad common stockholders (basic)
Basic weighted-average outstanding common shares
Additional dilutive shares related to share-based compensation
Diluted weighted-average outstanding shares
$
$
2014
2013
2012
$
$
52,354
(970)
51,384
19,804
329
20,133
$
$
21,555
(485)
21,070
19,850
415
20,265
5,897
(157)
5,740
19,701
304
20,005
Income per share:
Basic income attributable to Viad common stockholders
Diluted income attributable to Viad common stockholders(1)
(1) Diluted income per share amount cannot exceed basic income per share.
$
$
2.59
2.59
$
$
1.06
1.06
$
$
0.29
0.29
Options to purchase 26,000, 47,000 and 110,000 shares of common stock were outstanding during 2014,
2013 and 2012, respectively, but were not included in the computation of dilutive shares outstanding because the
effect would be anti-dilutive. Additionally, 329,000, 415,000 and 304,000 share-based compensation awards were
considered dilutive and included in the computation of diluted income per share in 2014, 2013 and 2012,
respectively.
Note 14. Employee Stock Ownership Feature of 401(k) Plan
Viad has historically funded its matching contributions to employees’ 401(k) accounts through the Company’s
ESOP portion of the Viad Corp Capital Accumulation Plan (the “401(k) Plan”). During 2014, the Company depleted
F-27
these shares and matching contributions are now funded from shares of Viad common stock held in treasury. All
eligible employees of Viad and its participating affiliates, other than certain employees covered by collective-
bargaining agreements that do not expressly provide for participation of such employees in an employee stock
ownership plan, may participate in the employee stock ownership feature within the 401(k) Plan.
In 1989, the ESOP borrowed $40.0 million (guaranteed by Viad) to purchase treasury shares from the
Company. In 2004, Viad borrowed $12.2 million under its revolving credit agreement to pay in full the outstanding
ESOP loan and obtain release of Viad from its guarantee of the loan. In connection with the loan payoff, the ESOP
entered into a $12.4 million loan with Viad maturing in June 2009 calling for minimum quarterly principal payments
of $250,000 plus interest. The same amount, representing unearned employee benefits, was recorded as a reduction
of stockholders’ equity. In 2007, the loan agreement between the ESOP and Viad was extended to December 31,
2016. As of December 31, 2014, the Company has fully paid off the ESOP loan. For prior years, the loan liability
is included in the consolidated balance sheets under the caption “Unearned employee benefits and other.” The
liability was reduced as the ESOP made principal payments on the borrowing, and the amount offsetting
stockholders’ equity was reduced as stock was allocated to employees and benefits were charged to expense. The
401(k) Plan repaid the loan using Viad contributions and dividends received on the unallocated Viad shares held
by the 401(k) Plan.
Information regarding ESOP transactions is as follows:
(in thousands)
Amounts paid by ESOP for:
Debt repayment
Interest
Amounts received from Viad as:
Contributions
Dividends
2014
2013
2012
$
44
—
44
—
$
$
1,280
1
1,202
79
1,647
5
1,604
48
Shares were released for allocation to participants based upon the ratio of the current year’s principal and
interest payments to the sum of the total principal and interest payments expected over the remaining life of the
loan. Viad recorded expense of less than $0.1 million in 2014, and $1.3 million and $1.7 million in 2013 and 2012,
respectively.
There were no unallocated shares held by the 401(k) Plan as of December 31, 2014 and unallocated shares
held by the 401(k) Plan totaled 4,361 as of December 31, 2013. In January 2014, the 4,361 shares remaining in
the ESOP as of December 31, 2013 were fully exhausted. Matching contributions on employee deferrals for the
remainder of 2014 were made from shares held in treasury. Shares allocated during 2013 totaled 126,216.
Note 15. Preferred Stock Purchase Rights
Viad has authorized five million and two million shares of Preferred Stock and Junior Participating Preferred
Stock, respectively, none of which was outstanding on December 31, 2014.
On February 28, 2013, Viad’s shareholder rights plan (the “Rights Agreement”), as adjusted in connection
with Viad’s one-for-four reverse stock split on July 1, 2004, and as amended on February 28, 2012, terminated on
its own terms and the Preferred Stock Purchase Rights issued pursuant to the Rights Agreement expired.
F-28
Note 16. Accumulated Other Comprehensive Income
Changes in accumulated other comprehensive income (“AOCI”) by component were as follows:
(in thousands)
Balance at December 31, 2012
Other comprehensive income before
reclassifications
Amounts reclassified from AOCI, net of tax
Net other comprehensive income (loss)
Balance at December 31, 2013
Other comprehensive income before
reclassifications
Amounts reclassified from AOCI, net of tax
Net other comprehensive income (loss)
Balance at December 31, 2014
$
$
$
Unrealized
Gains on
Investments
Cumulative
Foreign
Currency
Translation
Adjustments
Unrecognized
Net Actuarial
Loss and
Service Credit
Accumulated
Other
Comprehensive
Income
275
$
42,158
$
(14,968) $
27,465
215
(61)
154
429
98
(56)
42
$
471
$
(11,311)
—
(11,311)
30,847
(18,432)
—
(18,432)
12,415
$
$
3,421
288
3,709
(11,259) $
—
(2,021)
(2,021)
(13,280) $
(7,675)
227
(7,448)
20,017
(18,334)
(2,077)
(20,411)
(394)
The following table presents information about reclassification adjustments out of AOCI as of December 31:
(in thousands)
Unrealized gains on investments
Tax effect
Recognized net actuarial loss
Amortization of prior service credit
Tax effect
Note 17. Income Taxes
2014
2013
90
(34)
56
$
$
99
(38)
61
(3,821) $
(1,349)
565
1,235
(2,021) $
902
159
(288)
$
$
$
$
Affected Line Item in the
Statement Where Net
Income is Presented
Interest income
Income taxes
Income taxes
Earnings before income taxes from continuing operations consist of the following for the years ended
December 31:
(in thousands)
Foreign
United States
Income from continuing operations before income taxes
$
$
2014
2013
2012
33,349
7,938
41,287
$
$
25,010
2,620
27,630
$
$
29,645
(6,514)
23,131
F-29
Significant components of the income tax provision from continuing operations are as follows:
2014
2013
2012
The Company is subject to income tax in jurisdictions in which it operates. A reconciliation of the
statutory federal income tax rate to the effective tax rate of the Company for the years 2012 - 2014 is as follows:
2014
2013
2012
$
14,450
35.0 % $
9,670
35.0 % $
8,096
35.0 %
(in thousands)
Current:
United States:
Federal
State
Foreign
Total current
Deferred:
United States:
Federal
State
Foreign
Total deferred
Income tax expense
(in thousands)
Computed income tax expense at statutory
federal income tax rate of 35%
State income taxes, net of federal
provision
Foreign tax rate differentials
U.S. tax on foreign earnings (net of
foreign tax credits)
Change in valuation allowance
Proceeds from life insurance
Return to provision and other adjustments
Other, net
Income tax expense
$
— $
16
9,824
9,840
(9,486)
(125)
(120)
(9,731)
109
$
(3,308) $
(286)
9,606
6,012
2,007
651
(360)
2,298
$
8,310
$
(1,537)
2,189
7,652
8,304
11,127
40
107
11,274
19,578
2.0 %
(8.8)%
(2.6)%
61.5 %
(2.0)%
(1.6)%
1.1 %
84.6 %
227
(1,262)
0.5 %
(3.1)%
(2,168)
(5.3)%
(11,650)
(28.2)%
(133)
(1,401)
2,046
109
$
(0.3)%
(3.4)%
5.0 %
345
77
(1,831)
(2,184)
(196)
1,664
765
1.2 %
0.3 %
(6.6)%
(7.9)%
(0.7)%
6.0 %
2.8 %
470
(2,031)
(595)
14,220
(472)
(371)
261
0.2 % $
8,310
30.1 % $
19,578
F-30
The components of deferred income tax assets and liabilities included in the consolidated balance sheets as
of December 31 are as follows:
(in thousands)
Deferred tax assets:
Tax credit carryforwards
Pension, compensation and other employee benefits
Provisions for losses
Net operating loss carryforward
State income taxes
Other deferred income tax assets
Total deferred tax assets
Valuation allowance
Foreign deferred tax assets included above
Net deferred tax assets
Deferred tax liabilities:
Property and equipment
Deferred tax related to life insurance
Goodwill and other intangible assets
Unremitted foreign earnings
Other deferred income tax liabilities
Total deferred tax liabilities
Foreign deferred tax liabilities included above
United States deferred tax assets
2014
2013
$
$
21,783
23,501
12,127
4,886
2,979
3,927
69,203
(3,781)
(1,536)
63,886
(5,856)
(4,962)
(2,705)
—
(1,452)
(14,975)
3,671
52,582
$
$
26,945
23,835
13,674
4,794
2,170
5,552
76,970
(12,393)
(1,713)
62,864
(7,861)
(4,842)
(959)
(398)
(393)
(14,453)
1,989
50,400
The Company uses significant judgment in forming conclusions regarding the recoverability of its deferred
tax assets and evaluates all available positive and negative evidence to determine if it is more-likely-than-not that
the deferred tax assets will be realized. To the extent recovery does not appear likely, a valuation allowance must
be recorded. As of December 31, 2014 and 2013, Viad had gross deferred tax assets of $69.2 million and $77.0
million, respectively. These deferred tax assets reflect the expected future tax benefits to be realized upon reversal
of deductible temporary differences, and the utilization of net operating loss and tax credit carryforwards.
During the year ended 2014, the Company determined it was more likely than not based upon all positive
and negative evidence that its foreign tax credits would be fully utilized before expiration. Accordingly, a $11.4
million valuation allowance was released. At the end of 2014, the Company has $12.7 million in foreign tax credit
carryforwards that are subject to a 10-year carryforward period and will begin to expire in 2020.
As of December 31, 2014 and 2013, Viad had gross federal, state and foreign net operating loss carryforwards
of $75.8 million and $96.0 million, respectively, for which the Company had deferred tax assets of $4.9 million
and $4.8 million. The state and foreign net operating loss carryforwards expire on various dates from 2015 through
2034. During 2014, the Company decreased its valuation allowance related to state net operating loss carryforwards
by $0.6 million. As of December 31, 2014 and 2013, Viad had a valuation allowance of $3.8 million and $1.5
million, respectively, related to state and foreign deferred tax assets.
As of December 31, 2014, Viad had tax credit carryforwards related to alternative minimum tax of $8.8
million that may be carried forward indefinitely. Additionally, Viad had foreign tax credit carryforwards of $12.7
million, of which $4.7 million expire in 2020, $5.5 million expire in 2021, $0.6 million expire in 2022 and $1.9
million expire in 2023.
F-31
While management believes that the deferred tax assets, net of existing valuation allowances will be utilized
in future periods, there are inherent uncertainties regarding the ultimate realization of these assets. It is possible
that the relative weight of positive and negative evidence regarding the realization of deferred tax assets may
change, which could result in a material increase or decrease in the Company’s valuation allowance. Such a change
could result in a material increase or decrease to income tax expense in the period the assessment was made.
Viad has not recorded deferred taxes on certain historical unremitted earnings of its Canadian subsidiaries
as management intends to reinvest those earnings in its Canadian operations. As of December 31, 2014, the
incremental unrecognized tax liability (net of estimated foreign tax credits) related to those undistributed earnings
was approximately $350,000. To the extent that circumstances change and it becomes apparent that some or all of
those undistributed earnings will be remitted to the U.S., Viad would accrue income taxes attributable to such
remittance.
Viad exercises judgment in determining its income tax provision when the ultimate tax determination is
uncertain. Viad classifies liabilities associated with uncertain tax positions as non-current liabilities in its
consolidated balance sheets unless they are expected to be paid within the next year. As of December 31, 2014 and
2013, the Company had liabilities associated with uncertain tax positions (including interest and penalties) of $2.4
million and $1.8 million, respectively, which were classified as non-current liabilities.
As of December 31, 2014, the Company recognized a net increase in the liability for uncertain tax positions
for continuing operations of approximately $0.2 million. As of December 31, 2014, Viad had accrued interest and
penalties related to uncertain tax positions for continuing operations of $0.1 million which are classified as a
component of income tax expense. The tax expense impact of the uncertain tax positions was $0.4 million due to
tax credit carryforwards that were available to offset the expense. The Company expects that positions
approximating $0.3 million will be resolved or settled during 2015.
The Company had accrued liabilities for uncertain tax positions for discontinued operations of $0.6 million
as of December 31, 2014 and 2013. In addition, as of both December 31, 2014 and 2013, Viad had accrued interest
and penalties related to uncertain tax positions for discontinued operations of $0.5 million. Future tax resolutions
or settlements that may occur related to these uncertain tax positions would be recorded through discontinued
operations (net of federal tax effect, if applicable). The Company does not expect a material amount of uncertain
tax positions to be resolved or settled within the next twelve months.
A reconciliation of the liabilities associated with uncertain tax positions (excluding interest and penalties)
is as follows:
(in thousands)
Balance, December 31, 2011
Net additions and reductions
Balance at December 31, 2012
Additions for tax positions taken in prior years
Balance at December 31, 2013
Additions for tax positions taken in prior years
Reductions for lapse of applicable statutes
Balance at December 31, 2014
Continuing
Operations
Discontinued
Operations
Total
$
$
— $
—
—
736
736
1,019
(472)
1,283
$
636
—
636
—
636
—
—
636
$
$
636
—
636
736
1,372
1,019
(472)
1,919
Viad is subject to regular and recurring audits by taxing authorities in jurisdictions in which the Company
currently operates or has operated in the past. This includes the United States, Canada, United Kingdom, Germany,
and the Netherlands.
Viad’s 2008 through 2014 U.S. federal tax years and various state tax years from 2010 through 2014 remain
subject to income tax examinations by tax authorities. The 2006 Federal tax year remains subject to examination
F-32
Viad’s 2008 through 2014 U.S. federal tax years and various state tax years from 2010 through 2014 remain
subject to income tax examinations by tax authorities. The 2006 Federal tax year remains subject to examination
due to a federal net operating loss carryback claim. Tax years 2011 through 2014 remain subject to examination
by various foreign taxing jurisdictions.
Note 18. Pension and Postretirement Benefits
Domestic Plans. Viad has trusteed, frozen defined benefit pension plans that cover certain employees which
are funded by the Company. Viad also maintains certain unfunded defined benefit pension plans which provide
supplemental benefits to select management employees. These plans use traditional defined benefit formulas based
on years of service and final average compensation. Funding policies provide that payments to defined benefit
pension trusts shall be at least equal to the minimum funding required by applicable regulations.
Viad also has certain defined benefit postretirement plans that provide medical and life insurance for certain
eligible employees, retirees and dependents. The related postretirement benefit liabilities are recognized over the
period that services are provided by employees. In addition, Viad retained the obligations for these benefits for
retirees of certain sold businesses. While the plans have no funding requirements, Viad may fund the plans.
The components of net periodic benefit cost and other amounts recognized in other comprehensive income
of Viad’s pension plans included the following as of December 31:
(in thousands)
Net periodic benefit cost:
Service cost
Interest cost
Expected return on plan assets
Recognized net actuarial loss
Net periodic benefit cost
Other changes in plan assets and benefit obligations
recognized in other comprehensive income:
Net actuarial loss (gain)
Reversal of amortization item:
Net actuarial loss
Total recognized in other comprehensive income (loss)
Total recognized in net periodic benefit cost and other
comprehensive income (loss)
2014
2013
2012
$
$
87
1,079
(436)
407
1,137
$
66
1,030
(400)
583
1,279
104
1,150
(406)
491
1,339
3,418
(2,565)
1,942
(407)
3,011
(583)
(3,148)
(491)
1,451
$
4,148
$
(1,869) $
2,790
F-33
The components of net periodic benefit cost and other amounts recognized in other comprehensive income
of Viad’s postretirement benefit plans included the following:
(in thousands)
Net periodic benefit cost:
Service cost
Interest cost
Expected return on plan assets
Amortization of prior service credit
Recognized net actuarial loss
Net periodic benefit cost
Other changes in plan assets and benefit obligations
recognized in other comprehensive income:
Net actuarial loss (gain)
Prior service credit
Reversal of amortization item:
Net actuarial loss
Prior service credit
Total recognized in other comprehensive income (loss)
Total recognized in net periodic benefit cost and other
comprehensive income (loss)
2014
2013
2012
$
$
129
640
—
(593)
166
342
$
156
663
—
(902)
518
435
1,045
(1,283)
(166)
593
189
(1,496)
(40)
(518)
902
(1,152)
146
814
(74)
(1,113)
547
320
224
—
(547)
1,113
790
$
531
$
(717) $
1,110
The following table indicates the funded status of the plans as of December 31:
(in thousands)
Change in benefit obligation:
Benefit obligation at beginning of
year
Service cost
Interest cost
Actuarial adjustments
Plan amendments
Benefits paid
Benefit obligation at end of year
Change in plan assets:
Fair value of plan assets at
beginning of year
Actual return on plan assets
Company contributions
Benefits paid
Fair value of plan assets at end of
year
Funded status at end of year
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
2014
2013
2014
2013
2014
2013
$ 13,435
—
644
2,700
—
(767)
16,012
$ 15,348
—
608
(1,530)
—
(991)
13,435
$ 10,536
87
435
649
—
(580)
11,127
$ 11,570
66
422
(856)
—
(666)
10,536
$ 16,919
129
640
1,011
(1,283)
(1,181)
16,235
$ 18,701
156
663
(1,631)
(40)
(930)
16,919
10,872
364
729
(767)
10,624
580
659
(991)
—
—
580
(580)
—
—
666
(666)
520
(34)
695
(1,181)
1,397
(135)
188
(930)
11,198
520
$ (4,814) $ (2,563) $ (11,127) $ (10,536) $ (16,235) $ (16,399)
10,872
—
—
—
F-34
The net amounts recognized in Viad’s consolidated balance sheets under the caption “Pension and
postretirement benefits” as of December 31 were as follows:
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
(in thousands)
Other current liabilities
Non-current liabilities
Net amount recognized
2014
2013
2014
2013
2014
2013
$
$
— $
— $
4,814
4,814
$
2,563
2,563
$
635
10,492
11,127
$
$
713
9,823
10,536
$
$
1,094
15,141
16,235
$
$
928
15,471
16,399
Amounts recognized in accumulated other comprehensive income as of December 31, 2014 consisted of:
(in thousands)
Net actuarial loss
Prior service credit
Subtotal
Less tax effect
Total
Funded
Plans
Unfunded
Plans
Postretirement
Benefit Plans
Total
$
$
9,442
—
9,442
(3,581)
5,861
$
$
4,020
—
4,020
(1,525)
2,495
$
$
5,571
(2,729)
2,842
(1,078)
1,764
$
$
19,033
(2,729)
16,304
(6,184)
10,120
Amounts recognized in accumulated other comprehensive income as of December 31, 2013 consisted of:
(in thousands)
Net actuarial loss
Prior service credit
Subtotal
Less tax effect
Total
Funded
Plans
Unfunded
Plans
Postretirement
Benefit Plans
Total
$
$
6,972
—
6,972
(2,644)
4,328
$
$
3,480
—
3,480
(1,320)
2,160
$
$
4,692
(2,038)
2,654
(1,006)
1,648
$
$
15,144
(2,038)
13,106
(4,970)
8,136
The estimated net actuarial loss for the postretirement benefit plans that is expected to be amortized from
accumulated other comprehensive income into net periodic benefit cost in 2015 is approximately $0.5 million.
The estimated prior service credit for the postretirement benefit plans that is expected to be amortized from
accumulated other comprehensive income into net periodic benefit credit in 2015 is approximately $0.6 million.
The fair value of the domestic plans’ assets by asset class was as follows:
(in thousands)
Domestic pension plans:
Fixed income securities
U.S. equity securities
Cash
Other
Total
Fair Value Measurements at December 31, 2014
Quoted Prices
in Active
Markets
Total
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
$
$
6,534
3,855
552
257
11,198
$
$
6,534
3,855
552
—
10,941
$
$
— $
—
—
257
257
$
—
—
—
—
—
F-35
(in thousands)
Domestic pension plans:
Fixed income securities
U.S. equity securities
Cash
Other
Total
Postretirement benefit plans:
Fixed income securities
U.S. equity securities
Cash
Total
Fair Value Measurements at December 31, 2013
Quoted Prices
in Active
Markets
Total
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
$
$
$
$
5,966
4,542
147
217
10,872
407
109
4
520
$
$
$
$
5,966
4,542
147
—
10,655
407
109
4
520
$
$
$
$
— $
—
—
217
217
$
— $
—
—
— $
—
—
—
—
—
—
—
—
—
The Viad Corp Medical Plan maintained a trust account for plan assets invested in various securities. In
June 2014, the trust account was closed after all plan assets were liquidated to reimburse Viad Corp for net
postretirement medical claims paid.
Viad employs a total return investment approach whereby a mix of equities and fixed income securities is
used to maximize the long-term return of plan assets for a prudent level of risk. Risk tolerance is established through
careful consideration of plan liabilities, plan funded status, and corporate financial condition. The investment
portfolio contains a diversified blend of equity and fixed income securities. Furthermore, equity securities are
diversified across U.S. and non-U.S. stocks, as well as growth and value. Investment risk is measured and monitored
on an ongoing basis through quarterly investment portfolio reviews and annual liability measurements.
Viad utilizes a building-block approach in determining the long-term expected rate of return on plan assets.
Historical markets are studied and long-term historical relationships between equity securities and fixed income
securities are preserved consistent with the widely accepted capital market principle that assets with higher volatility
generate a greater return over the long run. Current market factors such as inflation and interest rates are evaluated
before long-term capital market assumptions are determined. The long-term portfolio return also considers
diversification and rebalancing. Peer data and historical returns are reviewed relative to Viad’s assumed rates for
reasonableness and appropriateness.
The following pension and postretirement benefit payments, which reflect expected future service, as
appropriate, are expected to be paid:
(in thousands)
2015
2016
2017
2018
2019
2020-2024
$
Funded
Plans
Unfunded
Plans
Postretirement
Benefit
Plans
$
872
845
888
908
889
5,046
$
647
745
781
802
812
3,869
1,116
1,159
1,175
1,185
1,161
5,441
F-36
Foreign Pension Plans. Certain of Viad’s foreign operations also maintain trusteed defined benefit pension
plans covering certain employees which are funded by the companies, and unfunded defined benefit pension plans
providing supplemental benefits to select management employees. These plans use traditional defined benefit
formulas based on years of service and final average compensation. Funding policies provide that payments to
defined benefit pension trusts shall be at least equal to the minimum funding required by applicable regulations.
The components of net periodic benefit cost and other amounts recognized in other comprehensive income included
the following:
(in thousands)
Net periodic benefit cost:
Service cost
Interest cost
Expected return on plan assets
Recognized net actuarial loss
Net periodic benefit cost
Other changes in plan assets and benefit obligations
recognized in other comprehensive income:
Net actuarial loss (gain)
Reversal of amortization of net actuarial loss
Total recognized in other comprehensive income (loss)
Total recognized in net periodic benefit cost and other
comprehensive income (loss)
2014
2013
2012
$
$
413
631
(640)
145
549
$
534
702
(698)
248
786
361
145
506
(1,214)
(248)
(1,462)
491
737
(622)
201
807
958
(201)
757
$
1,055
$
(676) $
1,564
The following table represents the funded status of the plans as of December 31:
(in thousands)
Change in benefit obligation:
Benefit obligation at beginning of year
Service cost
Interest cost
Actuarial adjustments
Benefits paid
Translation adjustment
Benefit obligation at end of year
Change in plan assets:
Fair value of plan assets at beginning of year
Actual return on plan assets
Company contributions
Benefits paid
Translation adjustment
Fair value of plan assets at end of year
Funded status at end of year
Funded Plans
Unfunded Plans
2014
2013
2014
2013
$
$
11,460
413
507
1,042
(344)
(1,062)
12,016
11,560
983
604
(344)
(1,056)
11,747
$
(269) $
15,387
534
582
(473)
(3,644)
(926)
11,460
12,997
1,148
1,892
(3,644)
(833)
11,560
100
$
$
2,911
—
124
234
(211)
(302)
2,756
—
211
(211)
—
(2,756) $
$
3,032
—
120
44
(219)
(66)
2,911
—
—
219
(219)
—
—
(2,911)
As of December 31, 2014 and 2013, the foreign funded plans had net liabilities of $0.3 million and net assets
of $0.1 million, respectively. The unfunded plans had liabilities of $2.8 million and $2.9 million at December 31,
2014 and 2013, respectively. These amounts are each included in the consolidated balance sheets under the caption
“Pension and postretirement benefits.”
F-37
The net actuarial losses for the foreign funded plans as of December 31, 2014 and 2013 were $4.0 million
($3.1 million after-tax) and $3.8 million ($2.8 million after-tax), respectively. The net actuarial losses as of
December 31, 2014 and 2013 for the foreign unfunded plans were $407,000 ($213,000 after-tax) and $367,000
($275,000 after-tax), respectively.
The fair value of the foreign pension plans’ assets by asset category were as follows:
(in thousands)
Assets:
Canadian fixed income securities
International equity securities
U.S. equity securities
Other
Total
(in thousands)
Assets:
Canadian fixed income securities
International equity securities
U.S. equity securities
Other
Total
Fair Value Measurements at December 31, 2014
Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
Total
5,367
4,693
1,236
451
11,747
$
$
5,367
4,273
1,236
451
11,327
$
$
— $
420
—
—
420
$
—
—
—
—
—
Fair Value Measurements at December 31, 2013
Quoted Prices
in Active
Markets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobserved
Inputs
(Level 3)
Total
5,174
4,781
1,269
336
11,560
$
$
5,174
4,386
1,269
336
11,165
$
$
— $
395
—
—
395
$
—
—
—
—
—
$
$
$
$
The following payments, which reflect expected future service, as appropriate, are expected to be paid:
(in thousands)
2015
2016
2017
2018
2019
2020-2024
Funded
Plans
Unfunded
Plans
$
$
357
431
434
456
517
3,055
187
187
186
186
186
918
F-38
Information for Pension Plans with an Accumulated Benefit Obligation in Excess of Plan Assets. The
accumulated benefit obligations in excess of plan assets as of December 31 were as follows:
(in thousands)
Projected benefit obligation
Accumulated benefit obligation
Fair value of plan assets
(in thousands)
Projected benefit obligation
Accumulated benefit obligation
Fair value of plan assets
Domestic Plans
Funded Plans
Unfunded Plans
2014
2013
2014
2013
$
16,012
16,012
11,200
$
13,435
13,435
10,872
$
11,127
11,014
—
10,536
10,227
—
Foreign Plans
Funded Plans
Unfunded Plans
2014
2013
2014
2013
$
12,016
11,268
11,747
$
11,460
10,823
11,560
$
2,756
2,656
—
2,911
2,911
—
$
$
Contributions. In aggregate for both the domestic and foreign plans, the Company anticipates contributing
$1.4 million to the funded pension plans, $0.8 million to the unfunded pension plans and $1.1 million to the
postretirement benefit plans in 2015.
Weighted-Average Assumptions. Weighted-average assumptions used to determine benefit obligations as
of December 31 were as follows:
Domestic Plans
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
Foreign Plans
Discount rate
Rate of compensation increase
2013
2014
2014
4.01% 4.89% 3.90% 4.60% 4.00% 4.65% 3.85% 4.67%
3.00% 3.00%
3.00% 3.00%
N/A
N/A
N/A
N/A
2014
2013
2013
2014
2013
Weighted-average assumptions used to determine net periodic benefit cost were as follows:
Domestic Plans
Funded Plans
Unfunded Plans
Postretirement
Benefit Plans
Foreign Plans
Discount rate
Expected return on plan assets
Rate of compensation increase
2014
2013
2013
2014
4.90% 4.09% 4.60% 3.80% 4.65% 3.85% 4.67% 4.03%
0.00% 0.00% 5.69% 5.44%
4.15% 3.90%
3.00% 3.00%
N/A
N/A
3.00% 4.50%
N/A
N/A
N/A
N/A
2014
2013
2014
2013
The assumed health care cost trend rate used in measuring the December 31, 2014 accumulated postretirement
benefit obligation was 7.5 percent, declining one-quarter percent each year to the ultimate rate of 5.0 percent by
the year 2024 and remaining at that level thereafter. The assumed health care cost trend rate used in measuring the
December 31, 2013 accumulated postretirement benefit obligation was 8.0 percent, declining one-half percent
each year to the ultimate rate of 5.0 percent by the year 2019 and remaining at that level thereafter.
A one-percentage-point increase in the assumed health care cost trend rate for each year would increase the
accumulated postretirement benefit obligation as of December 31, 2014 by approximately $1.8 million and the
total of service and interest cost components by approximately $0.1 million. A one-percentage-point decrease in
the assumed health care cost trend rate for each year would decrease the accumulated postretirement benefit
obligation as of December 31, 2014 by approximately $1.5 million and the total of service and interest cost
components by approximately $0.1 million.
F-39
Multi-employer Plans. Viad contributes to defined benefit pension plans under the terms of collective-
bargaining agreements that cover its union-represented employees. The financial risks of participating in these
multi-employer pension plans generally include the fact that assets contributed to the plan by one employer may
be used to provide benefits to employees of other participating employers. Furthermore, if a participating employer
ceases to contribute to the plan, the unfunded obligations of the plan may be borne by the remaining participating
employers. In addition, if Viad were to discontinue its participation in some of its multi-employer pension plans,
the Company may be required to pay those plans a withdrawal liability amount based on the underfunded status
of the plan. Viad also contributes to defined contribution plans pursuant to its collective-bargaining agreements,
which are generally not subject to the funding risks inherent in defined benefit pension plans. The overall level of
Viad’s contributions to its multi-employer plans may significantly vary from year to year based on the demand for
union-represented labor to support the Company’s operations. Viad does not have any minimum contribution
requirements for future periods pursuant to its collective-bargaining agreements for individually significant multi-
employer plans.
Viad’s participation in multi-employer pension plans for 2014 is outlined in the following table. Unless
otherwise noted, the most recent Pension Protection Act zone status available in 2014 and 2013 relates to the plan’s
year end as of December 31, 2013 and 2012, respectively, and is based on information received from the plan.
Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are
less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/
Implemented” column indicates plans for which a financial improvement plan or a rehabilitation plan is either
pending or has been implemented.
F-40
Pension
Protection Act
Zone Status
Plan
(in thousands)
Pension Fund:
EIN
No.
2014
2013
FIP/RP
Status
Pending/
Implemented
Viad Contributions
2014
2013
2012
Surcharge
Paid
Expiration
Date of
Collective-
Bargaining
Agreement(s)
Western Conference of
Teamsters Pension Plan
91-6145047
95-6376874
36-6130207
53-0181657
51-6030753
36-6044243
36-1416355
95-6042875
95-6392774
Southern California
Local 831—Employer
Pension Fund(1)
Chicago Regional
Council of Carpenters
Pension Fund
National Electrical
Benefit Fund
Electrical Contractors
Assoc. Chicago Local
Union 134, IBEW Joint
Pension Trust of Chicago
Plan #2
Central States, Southeast
and Southwest Areas
Pension Plan
Machinery Movers
Riggers & Mach Erect
Local 136 Supplemental
Retirement Plan(1),
Southwest Carpenters
Pension Trust
Southern California
IBEW-NECA Pension
Fund
All other funds(2)
Total contributions to
defined benefit plans
Total contributions to
other plans
1
1
1
1
2
1
1
1
1
Green
Green
Green
Green
Yellow
Yellow
Green
Green
No
No
Yes
No
$ 6,369
$ 5,524
$ 5,694
No
5/31/15
2,481
2,244
2,358
No
8/31/17
1,946
1,614
1,749
1,457
1,631
1,814
No
No
5/31/18
6/16/15
Green
Green
No
1,081
957
108
No
6/3/17
Red
Red
Yes
1,018
836
874
No
7/31/15
Red
Red
Green
Green
Yes
No
993
885
430
812
930
944
No
No
6/30/19
6/30/15
Yellow
Yellow
Yes
768
4,097
184
2,592
62
No
continuous
2,468
21,095
16,824
17,001
2,057
3,489
3,668
Total contributions to
multi-employer plans
(1) The Company contributed more than 5 percent of total plan contributions for the 2013 and 2012 plan years based
$ 20,313
$ 23,152
$ 20,669
on the plans’ Form 5500s.
(2) Represents participation in 41 pension funds during 2014.
Other Employee Benefits. Costs of the 401(k) Plan and other benefit plans totaled less than $0.1 million
for 2014, and $1.3 million and $1.7 million in 2013 and 2012, respectively.
Note 19. Restructuring Charges
Marketing & Events Group Consolidation
Beginning in 2009, Viad commenced certain restructuring actions designed to reduce the Company’s cost
structure primarily within the Marketing & Events U.S. segment, and to a lesser extent in the Marketing & Events
International segment. The Company implemented a strategic reorganization plan in order to consolidate the
separate business units within the Marketing & Events U.S. segment. The Company also consolidated facilities
and streamlined its operations in the United Kingdom and Germany. As a result, the Company recorded restructuring
charges in 2014, 2013 and 2012, primarily consisting of severance and related benefits as a result of workforce
reductions and charges related to the consolidation and downsizing of facilities representing the remaining operating
lease obligations (net of estimated sublease income) and related costs.
F-41
Other Restructurings
The Company has recorded restructuring charges in connection with the consolidation of certain support
functions at its corporate headquarters, and certain reorganization activities within the Travel & Recreation Group.
These charges primarily consist of severance and related benefits due to headcount reductions.
The table below represents a reconciliation of beginning and ending liability balances by major restructuring
activity:
(in thousands)
Balance at December 31, 2011
Restructuring charges
Cash payments
Adjustment to liability
Foreign currency translation
adjustment
Balance at December 31, 2012
Restructuring charges (recoveries)
Cash payments
Adjustment to liability
Balance at December 31, 2013
Restructuring charges (recoveries)
Cash payments
Adjustment to liability
Balance at December 31, 2014
Marketing & Events
Group Consolidation
Other Restructurings
Severance &
Employee
Benefits
Facilities
Severance &
Employee
Benefits
Facilities
Total
$
831
$
4,819
$
24
$
1,276
$
2,506
(2,670)
51
2
720
2,931
(2,411)
—
1,240
2,358
(3,055)
—
$
543
$
2,346
(1,567)
(27)
—
5,571
(315)
(1,691)
—
3,565
(828)
(1,376)
(200)
1,161
90
(114)
—
—
—
1,869
(498)
(478)
893
107
(845)
85
—
(343)
—
—
933
(692)
(241)
—
—
—
—
—
$
240
$
— $
6,950
4,942
(4,694)
24
2
7,224
3,793
(4,841)
(478)
5,698
1,637
(5,276)
(115)
1,944
As of December 31, 2014, the liabilities related to severance and employee benefits are expected to be paid
by the end of 2015. Refer to Note 22, Segment Information for information regarding restructuring charges by
segment.
Note 20. Leases and Other
Viad has entered into operating leases for the use of certain of its offices, equipment and other facilities.
These leases expire over periods up to 40 years. Leases which expire are generally renewed or replaced by similar
leases. Some leases contain scheduled rental increases accounted for on a straight-line basis.
F-42
As of December 31, 2014, Viad’s future minimum rental payments and related sublease rentals receivable
with respect to non-cancelable operating leases with terms in excess of one year were as follows:
(in thousands)
2015
2016
2017
2018
2019
Thereafter
Total
Rental
Payments
16,343
14,115
12,709
10,888
7,739
9,755
71,549
$
$
Receivable
Under Subleases
1,372
$
1,232
1,021
1,023
622
926
6,196
$
Net rent expense under operating leases consisted of the following as of December 31:
(in thousands)
Minimum rentals
Sublease rentals
Total rentals, net
2014
2013
2012
$
$
37,707
(6,884)
30,823
$
$
34,201
(6,815)
27,386
$
$
36,309
(6,501)
29,808
The aggregate annual maturities and the related amounts representing interest on capital lease obligations
are included in Note 11.
In addition, as of December 31, 2014, the Company had aggregate purchase obligations of $28.2 million
related to various licensing agreements, consulting and other contracted services.
Note 21. Litigation, Claims, Contingencies and Other
Viad and certain of its subsidiaries are plaintiffs or defendants to various actions, proceedings and pending
claims, some of which involve, or may involve, compensatory, punitive or other damages. Litigation is subject to
many uncertainties and it is possible that some of the legal actions, proceedings or claims could be decided against
Viad. Although the amount of liability as of December 31, 2014 with respect to these matters is not ascertainable,
Viad believes that any resulting liability, after taking into consideration amounts already provided for and insurance
coverage, will not have a material effect on Viad’s business, financial position or results of operations.
Viad is subject to various U.S. federal, state and foreign laws and regulations governing the prevention of
pollution and the protection of the environment in the jurisdictions in which Viad has or had operations. If the
Company has failed to comply with these environmental laws and regulations, civil and criminal penalties could
be imposed and Viad could become subject to regulatory enforcement actions in the form of injunctions and cease
and desist orders. As is the case with many companies, Viad also faces exposure to actual or potential claims and
lawsuits involving environmental matters relating to its past operations. Although it is a party to certain
environmental disputes, Viad believes that any resulting liabilities, after taking into consideration amounts already
provided for and insurance coverage, will not have a material effect on the Company’s financial position or results
of operations. As of December 31, 2014 and 2013, Viad had recorded environmental remediation liabilities of $4.7
million and $5.0 million related to previously sold operations, respectively.
As of December 31, 2014, Viad had certain obligations under guarantees to third parties on behalf of its
subsidiaries. These guarantees are not subject to liability recognition in the consolidated financial statements and
relate to leased facilities entered into by Viad’s subsidiary operations. The Company would generally be required
to make payments to the respective third parties under these guarantees in the event that the related subsidiary
could not meet its own payment obligations. The maximum potential amount of future payments that Viad would
be required to make under all guarantees existing as of December 31, 2014 would be $5.9 million. These guarantees
relate to leased facilities expiring through October 2017. There are no recourse provisions that would enable Viad
F-43
to recover from third parties any payments made under the guarantees. Furthermore, there are no collateral or
similar arrangements whereby Viad could recover payments.
A significant portion of Viad’s employees are unionized and the Company is a party to approximately 100
collective-bargaining agreements, with approximately one-third requiring renegotiation each year. As of
December 31, 2014, approximately 30 percent of Viad’s regular full-time employees are covered by collective-
bargaining agreements. If the Company were unable to reach an agreement with a union during the collective-
bargaining process, the union may call for a strike or work stoppage, which may, under certain circumstances,
adversely impact the Company’s businesses and results of operations. Viad believes that relations with its employees
are satisfactory and that collective-bargaining agreements expiring in 2015 will be renegotiated in the ordinary
course of business without having a material adverse effect on Viad’s operations. The Company entered into new
showsite and warehouse agreements with the Chicago Teamsters Local 727, effective January 1, 2014, and those
agreements contain provisions that allow the parties to re-open negotiation of the agreements on pension-related
issues. The Company is in informal discussions regarding those issues with all relevant parties and is working
diligently to resolve those issues in a manner that will be reasonable and equitable to employees, customers and
shareholders. Although the Company’s labor relations are currently stable, disruptions pending the outcome of the
Chicago Teamsters Local 727 negotiations could occur, as they could with any collective-bargaining agreement
negotiation, with the possibility of an adverse impact on the operating results of the Marketing & Events Group.
Viad’s businesses contribute to various multi-employer pension plans based on obligations arising under
collective bargaining agreements covering its union-represented employees. Viad’s contributions to these plans in
2014, 2013 and 2012 totaled $23.2 million, $20.3 million and $20.7 million, respectively. Based upon the
information available to Viad from plan administrators, management believes that several of these multi-employer
plans are underfunded. The Pension Protection Act of 2006 requires pension plans underfunded at certain levels
to reduce, over defined time periods, the underfunded status. In addition, under current laws, the termination of a
plan, or a voluntary withdrawal from a plan by Viad, or a shrinking contribution base to a plan as a result of the
insolvency or withdrawal of other contributing employers to such plan, would require Viad to make payments to
such plan for its proportionate share of the plan’s unfunded vested liabilities. As of December 31, 2014, the amount
of additional funding, if any, that Viad would be required to make related to multi-employer pension plans is not
ascertainable.
Viad is self-insured up to certain limits for workers’ compensation, employee health benefits, automobile,
product and general liability and property loss claims. The aggregate amount of insurance liabilities (up to the
Company’s retention limit) related to Viad’s continuing operations was approximately $19.9 million as of December
31, 2014. Of this total, $12.4 million related to workers’ compensation liabilities and the remaining $7.5 million
related to general/auto liability claims. Viad has also retained and provided for certain insurance liabilities in
conjunction with previously sold businesses totaling $4.5 million as of December 31, 2014, related to workers’
compensation liabilities. Provisions for losses for claims incurred, including estimated claims incurred but not yet
reported, are made based on Viad’s historical experience, claims frequency and other factors. A change in the
assumptions used could result in an adjustment to recorded liabilities. Viad has purchased insurance for amounts
in excess of the self-insured levels, which generally range from $0.2 million to $0.4 million on a per claim basis.
Viad does not maintain a self-insured retention pool fund as claims are paid from current cash resources at the time
of settlement. Viad’s net cash payments in connection with these insurance liabilities were $4.8 million, $6.6 million
and $5.6 million in 2014, 2013 and 2012, respectively.
In addition, as of December 31, 2014 Viad had recorded insurance liabilities of $7.7 million related to
continuing operations in excess of the self-insured levels for which Viad remains the primary obligor. Of this total,
$3.1 million related to workers’ compensation liabilities and the remaining $4.6 million related to general/auto
liability claims. The Company has recorded those amounts in other deferred items and liabilities in Viad’s Condensed
Consolidated Balance Sheets with a corresponding receivable in other investments and assets.
F-44
Note 22. Segment Information
Viad measures profit and performance of its operations on the basis of segment operating income which
excludes restructuring charges and recoveries and impairment charges and recoveries. 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. No reportable segment has a single client comprising more
than 6.3 percent of that segment’s revenues, and no single client comprises more than 4.2 percent of Viad’s revenues.
Disclosures regarding Viad’s reportable segments with reconciliations to consolidated totals are as follows:
2014
2013
2012
$
$
$
$
$
$
710,835
249,649
(16,016)
944,468
120,519
1,064,987
21,400
10,339
31,739
28,127
59,866
(14,348)
45,518
305
(2,015)
278
(1,808)
41
(148)
$
$
$
628,856
229,312
(13,264)
844,904
108,443
953,347
11,024
9,068
20,092
21,819
41,911
(6,755)
35,156
550
(1,234)
409
(2,362)
(809)
(1,031)
—
(884)
—
41,287
$
(658)
(294)
(2,097)
27,630
$
676,772
240,137
(14,869)
902,040
104,604
1,006,644
5,579
12,321
17,900
20,291
38,191
(9,408)
28,783
593
(1,303)
(3,479)
(1,373)
(79)
(11)
—
—
—
23,131
(in thousands)
Revenues:
Marketing & Events Group:
U.S.
International
Intersegment eliminations
Total Marketing & Events Group
Travel & Recreation Group
Total revenue
Segment operating income:
Marketing & Events Group:
U.S.
International
Total Marketing & Events Group
Travel & Recreation Group
Segment operating income
Corporate activities
Operating income
Interest income
Interest expense
Restructuring recoveries (charges):
Marketing & Events U.S.
Marketing & Events International
Travel & Recreation Group
Corporate
Impairment charges:
Marketing & Events U.S.
Marketing & Events International
Travel & Recreation Group
Income from continuing operations before income taxes $
F-45
(in thousands)
Assets:
Marketing & Events Group:
U.S.
International
Travel & Recreation Group
Corporate and other
Depreciation and amortization:
Marketing & Events Group:
U.S.
International
Travel & Recreation Group
Corporate and other
Capital expenditures:
Marketing & Events Group:
U.S.
International
Travel & Recreation Group
Corporate and other
2014
2013
2012
$
$
$
$
$
$
304,727
116,842
199,986
93,388
714,943
16,066
6,311
8,232
183
30,792
14,515
4,134
10,740
—
29,389
$
$
$
$
$
$
194,422
81,058
209,611
76,841
561,932
14,906
5,566
7,319
176
27,967
8,278
4,332
23,108
401
36,119
$
$
$
$
$
$
203,145
100,387
223,199
123,846
650,577
17,643
5,162
7,183
145
30,133
7,525
4,913
15,201
36
27,675
Geographic Areas. Viad’s foreign operations are located principally in Canada, the United Kingdom,
Germany, the United Arab Emirates and the Netherlands. Marketing & Events Group revenues are designated as
domestic or foreign based on the originating location of the product or service. Long-lived assets are attributed to
domestic or foreign based principally on the physical location of the assets. Long-lived assets consist of “Property
and equipment, net” and “Other investments and assets.” The table below presents the financial information by
major geographic area:
(in thousands)
Revenues:
United States
United Kingdom
Canada
Other international
Total revenues
Long-lived assets:
United States
Canada
United Kingdom
Other international
Total long-lived assets
2014
2013
2012
$
$
$
$
718,538
174,127
153,775
18,547
1,064,987
130,401
78,193
13,973
242
222,809
$
$
$
$
637,482
151,217
148,934
15,714
953,347
132,315
82,986
9,631
424
225,356
$
$
$
$
681,827
153,027
151,070
20,720
1,006,644
141,727
76,067
9,757
2,163
229,714
Note 23. Common Stock Repurchases
In December 2012, Viad announced the authorization of its Board of Directors to repurchase shares of the
Company’s common stock from time to time at prevailing market prices. During 2014, Viad repurchased 448,436
F-46
shares on the open market for $10.6 million. No shares were repurchased on the open market during 2013. As of
December 31, 2014, 582,002 shares remain available for repurchase. Additionally, during 2014, 2013 and 2012,
the Company withheld 72,996 shares at a cost of $1.8 million, 50,156 shares at a cost of $1.3 million and 56,885
shares at a cost of $1.1 million, respectively, related to tax withholding requirements on share-based awards.
As part of
the Company
repurchased141,462 shares on the open market at a total cost of approximately $3.8 million. Refer to Note 26,
Subsequent Event.
the Company’s share
repurchase program,
in February 2015,
Note 24. Discontinued Operations
In 2014, Viad recorded income from discontinued operations of $13.3 million primarily related to the gain
on the possessory interest and personal property at Glacier Park. The Company’s 2013 and 2012 results related to
the operations of Glacier Park’s concession contract business have been reclassified as discontinued operations in
Viad’s Condensed Consolidated Statements of Operations. For the years ended 2013 and 2012, Viad recorded
income from discontinued operations of $1.2 million and $2.4 million related to Glacier Park income.
On December 31, 2013, Glacier Park’s concession contract with the Park Service to operate lodging, tour
and transportation and other hospitality services within Glacier National Park expired. Upon completion of the
contract, the Company received cash payments in January 2014 totaling $25.0 million resulting in a pre-tax gain
of $21.5 million for the Company’s possessory interest. The gain after-tax on the possessory interest was $13.5
million with $2.7 million attributable to the noncontrolling interest. These amounts are included in income (loss)
from discontinued operations and net income attributable to noncontrolling interest in Viad’s Condensed
Consolidated Statements of Operations, respectively. In September 2014, the Company received $3.0 million in
cash for the sale of the remaining personal property assets held for sale at Glacier Park. This resulted in a gain of
approximately $0.7 million, net of tax.
The following summarizes Glacier Park’s expired concession contract operating results, which are presented
in income (loss) from discontinued operations, net of tax, in Viad’s Condensed Consolidated Statements of
Operations as of December 31:
(in thousands)
Total revenue
Costs (recoveries) and expenses
Impairment charges
Restructuring charges
Income from discontinued operations, before income taxes
Income tax (expense) benefit
Income from discontinued operations, net of tax
Gain on sale of discontinued operations, net of tax
Income from discontinued operations
2014
2013
2012
$
(93)
—
—
(93)
45
(48)
13,343
13,295
19,445
(15,462)
(2,364)
(98)
1,521
(280)
1,241
—
1,241
$
18,587
(14,916)
—
—
3,671
(1,265)
2,406
—
2,406
(481)
1,925
Income from discontinued operations attributable to
noncontrolling interest
Income from discontinued operations attributable to Viad
(2,825)
10,470
$
$
(248)
993
$
For the year ended December 31, 2013, the Company recorded a non-cash impairment charge of $4.5 million
representing all goodwill at the Glacier Park reporting unit, of which $2.1 million related to continuing operations
and $2.4 million related to discontinued operations. Additionally, for the year ended December 31, 2013, the
Company recorded other asset impairment charges of $1.0 million at the Marketing & Events Group related to the
write-off of certain assets within the Marketing & Events Group.
F-47
For the year ended December 31, 2014, Viad also recorded income from discontinued operations, net of tax,
of $1.1 million primarily due to additional reserves related to certain liabilities associated with previously sold
operations and an insurance recovery. For the year ended December 31, 2013, Viad recorded income from
discontinued operations, net of tax, of $1.1 million primarily related to the sale of land associated with previously
sold operations. In 2012, Viad recorded income from discontinued operations of $0.6 million related to the reversal
of certain liabilities associated with previously sold operations.
The following is a reconciliation of net income attributable to the noncontrolling interest for the year ended
December 31:
(in thousands)
Income (loss) from continuing operations
Income from discontinued operations
Net income attributable to noncontrolling interest
2014
2013
2012
$
$
388
2,825
3,213
$
$
(117) $
248
131
$
205
481
686
Note 25. Condensed Consolidated Quarterly Results (Unaudited)
The following quarterly financial information was derived from the Company’s interim financial statements
and was prepared in a manner consistent with the annual financial statements and includes all adjustments
(consisting of normal recurring accruals) considered necessary for a fair presentation.
(in thousands, except per share data)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
2014
2013
Revenues:
Operating income (loss):
Ongoing operations(1)
Corporate activities
$ 285,641
$ 256,391
$ 299,802
$ 223,155
$ 285,159
$ 246,180
$ 220,167
$ 201,842
$
13,361
$
14,136
$
33,013
$
(644)
$
13,595
$
11,455
$
18,723
$
(1,862)
Restructuring (charges) recoveries
Impairment charges
Operating income (loss)
Income (loss) from continuing operations
attributable to Viad(2)
Net income (loss) attributable to Viad(2)
Income (loss) per common share-Diluted(2),
(3):
Income (loss) from continuing operations
attributable to Viad
Net income (loss) attributable to Viad
Income (loss) per common share-Basic(2),(3):
Income (loss) from continuing operations
attributable to Viad
$
$
$
$
$
$
(2,039)
(211)
—
11,111
9,312
21,882
0.46
1.08
$
$
$
$
$
(1,991)
(1,369)
(884)
9,892
7,978
6,742
0.39
0.33
(3,468)
(6,850)
(234)
—
29,311
30,755
29,620
1.53
1.48
$
$
$
$
$
$
$
$
$
$
177
—
(7,317)
(7,255)
(5,889)
(0.37)
(0.30)
$
$
$
$
$
(806)
(720)
—
12,069
8,453
8,065
0.42
0.40
$
$
$
$
$
(1,167)
(2,034)
(773)
—
9,515
6,516
6,253
0.32
0.31
$
$
$
$
$
(639)
(3,049)
13,001
8,871
11,855
0.44
0.58
$
$
$
$
$
(2,748)
(1,661)
—
(6,271)
(4,403)
(4,618)
(0.22)
(0.23)
0.46
$
0.39
$
1.53
$
(0.37)
$
0.42
$
0.32
$
0.44
$
(0.22)
Net income (loss) attributable to Viad
1.48
(1) Represents revenues less costs of services and products sold.
(2) Includes $10.9 million benefit associated with the 2014 third quarter release of the valuation allowance relating
(0.23)
(0.30)
0.40
0.58
0.31
0.33
1.08
$
$
$
$
$
$
$
$
to foreign income tax credits.
(3) The sum of quarterly income per share amounts may not equal annual income per share due to rounding.
Note 26. Subsequent Event
As part of
the Company’s share
repurchase program,
in February 2015,
the Company
repurchased 141,462 shares on the open market at a total cost of approximately $3.8 million.
F-48
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Directors and Stockholders
Viad Corp
Phoenix, Arizona
We have audited the accompanying consolidated balance sheets of Viad Corp and subsidiaries (the
“Company”) as of December 31, 2014 and 2013, and the related consolidated statements of operations,
comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended
December 31, 2014. Our audits also included the financial statement schedule listed in the Index at Item 15. These
consolidated financial statements and financial statement schedule are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these consolidated financial statements and financial
statement schedule based on our audits.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether effective internal control over financial reporting was maintained in all material respects. Our audit
included obtaining an understanding of internal control over financial reporting, assessing the risk that a material
weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial
position of the Company as of December 31, 2014 and 2013, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 2014, in conformity with accounting principles
generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when
considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material
respects, the information set forth therein.
We have audited the internal control over financial reporting of Viad Corp and subsidiaries (the “Company”)
as of December 31, 2014, based on criteria established in Internal Control-Integrated Framework (2013) issued
by the Committee of Sponsoring Organizations of the Treadway Commission.
/s/ DELOITTE & TOUCHE LLP
Deloitte & Touche LLP
Phoenix, Arizona
March 12, 2015
F-49
VIAD CORP
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
(in thousands)
Allowance for doubtful accounts:
December 31, 2012
December 31, 2013
December 31, 2014
Deferred tax valuation allowance:
December 31, 2012
December 31, 2013
December 31, 2014
Additions
Deductions
Balance at
Beginning
Charged to
Charged to
Other
Credited
to Other
Balance at
of Year
Expense
Accounts
Write Offs
Accounts
End of Year
$
$
$
1,072
1,150
877
708
313
821
356
14,576
12,393
$ 14,220
1,917
95
$
$
— $
—
—
(630) $
(586)
(440)
— $
—
—
1,150
877
1,258
— $
—
2,589
— $
(4,100)
(11,782)
— $ 14,576
12,393
—
3,295
—
F-50
EXHIBIT INDEX
Exhibit #
3.A
3.B
4.A
4.B
10.A1
10.A2
10.A3
10.A4
10.A5
10.A6
10.A7
10.A8
10.A9
10.A10
10.A11
10.A12
Copy of Restated Certificate of Incorporation of Viad Corp, as amended through July 1, 2004,
filed as Exhibit 3.A to Viad Corp’s Form 10-Q for the period ended June 30, 2004, is hereby
incorporated by reference (SEC File No. 001-11015; SEC Film No. 04961107).
Copy of Bylaws of Viad Corp, as amended through December 5, 2013, filed as Exhibit 3 to Viad
Corp’s Form 8-K filed December 9, 2013, is hereby incorporated by reference.
Copy of $300,000,000 Amended and Restated Credit Agreement, dated as of December 22, 2014,
filed as Exhibit 4 to Viad Corp’s Form 8-K filed December 23, 2014, is hereby incorporated by
reference.
Copy of Amended and Restated Pledge and Security Agreement, Guaranty, and Amended and
Restated Subsidiary Pledge and Security Agreement dated as of December 22, 2014, filed as
Exhibit 4 to Viad Corp’s Form 8-K filed December 23, 2014, is hereby incorporated by reference.
Copy of 2007 Viad Corp Omnibus Incentive Plan, filed as Appendix A to Viad Corp’s Proxy
Statement for the 2012 Annual Meeting of Shareholders, filed April 13, 2012, is hereby
incorporated by reference.+
Copy of form of Restricted Stock Agreement-Executives, effective as of February 25, 2008,
pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.C to Viad Corp’s
Form 8-K filed February 28, 2008, is hereby incorporated by reference (SEC File No. 001-11015;
SEC Film No. 08651224).+
Copy of form of Restricted Stock Agreement for Outside Directors, effective as of February 25,
2008, pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.F to Viad
Corp’s Form 8-K filed February 28, 2008, is hereby incorporated by reference (SEC File No.
001-11015; SEC Film No. 08651224).+
Copy of form of Performance Unit Agreement, effective as of March 26, 2014, pursuant to the
2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.C to Viad Corp’s Form 8-K filed
March 28, 2014, is hereby incorporated by reference.+
Copy of form of Restricted Stock Agreement - Executives (three-year cliff vesting), effective as of
March 23, 2011, pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.B to
Viad Corp’s Form 8-K filed March 29, 2011, is hereby incorporated by reference.+
Copy of form of Restricted Stock Units Agreement, effective as of March 23, 2011, pursuant to
the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.C to Viad Corp’s Form 8-K filed
March 29, 2011, is hereby incorporated by reference.+
Copy of form of Performance Unit Agreement, effective as of March 23, 2011, pursuant to the
2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.D to Viad Corp’s Form 8-K filed
March 29, 2011, is hereby incorporated by reference.+
Copy of Viad Corp Performance Unit Incentive Plan, effective as of February 27, 2013, pursuant
to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.D to Viad Corp’s Form 8-K
filed March 5, 2013, is hereby incorporated by reference.+
Copy of Viad Corp Management Incentive Plan, amended as of February 27, 2013, pursuant to the
2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.C to Viad Corp’s Form 8-K filed
March 5, 2013, is hereby incorporated by reference.+
Copy of form of Non-Qualified Stock Option Agreement, effective as of February 25, 2008,
pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.D to Viad Corp’s
Form 8-K filed February 28, 2008, is hereby incorporated by reference (SEC File No. 001-11015;
SEC Film No. 08651224).+
Copy of form of Non-Qualified Stock Option Agreement, effective as of February 25, 2010,
pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.B to Viad Corp’s
Form 8-K filed February 26, 2010, is hereby incorporated by reference (SEC File No.
001-110015; SEC Film No. 10640085).+
Copy of form of Incentive Stock Option Agreement, effective as of February 25, 2010, pursuant to
the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.A to Viad Corp’s Form 8-K filed
February 26, 2010, is hereby incorporated by reference (SEC File No. 001-110015; SEC Film No.
10640085).+
10.A13
10.A14
10.A15
10.A16
10.A17
10.B1
10.B2
10.C1
10.C2
10.C3
10.C4
10.D1
10.D2
10.D3
10.E
10.F1
10.F2
Copy of form of Restricted Stock Units Agreement, effective as of February 24, 2009, pursuant to
the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.A to Viad Corp’s Form 8-K filed
February 26, 2009, is hereby incorporated by reference (SEC File No. 001-11015; SEC Film No.
09634971).+
Copy of form of Restricted Stock Agreement - Executives (three-year cliff vesting), effective as of
November 29, 2012, pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10
to Viad Corp’s Form 8-K filed December 3, 2012, is hereby incorporated by reference.+
Copy of form of Restricted Stock Units Agreement, effective as of March 26, 2014, pursuant to
the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.B to Viad Corp’s Form 8-K filed
March 28, 2014, is hereby incorporated by reference.+
Copy of form of Restricted Stock Agreement - Executives, effective as of March 26, 2014,
pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.A to Viad Corp’s
Form 8-K filed March 28, 2014, is hereby incorporated by reference.+
Copy of form of Restricted Stock Agreement - Executives, effective as of December 3, 2014,
pursuant to the 2007 Viad Corp Omnibus Incentive Plan, filed as Exhibit 10.A to Viad Corp’s
Form 8-K filed December 5, 2014, is hereby incorporated by reference.+
Copy of form of Transition Services Agreement, effective as of January 2, 2014, between
Brewster Inc. and Michael M. Hannan, filed as Exhibit 10 to Viad Corp’s Form 8-K filed March
17, 2014, is hereby incorporated by reference.+
Copy of Severance Agreement and General Release between Viad Corp and Paul B. Dykstra,
effective as of December 3, 2014, filed as Exhibit 10.C to Viad Corp’s Form 8-K filed December
5, 2014, is hereby incorporated by reference.+
Copy of form of Viad Corp Executive Severance Plan (Tier I-2013), effective as February 27,
2013, filed as Exhibit 10.B to Viad Corp’s Form 8-K filed March 5, 2013, is hereby incorporated
by reference.+
Copy of forms of Viad Corp Executive Severance Plans (Tier I and II), amended and restated for
Code Section 409A as of January 1, 2005, filed as Exhibit 10.B to Viad Corp’s Form 8-K filed
August 29, 2007, is hereby incorporated by reference (SEC File No. 001-11015; SEC Film No.
071088413).+
Copy of amendment No. 1 to Viad Corp Executive Severance Plan (Tier I), effective as of
February 26, 2014, filed as Exhibit 10 to Viad Corp’s Form 8-K filed March 4, 2014, is hereby
incorporated by reference.+
Copy of Executive Officer Pay Continuation Policy adopted February 7, 2007, filed as Exhibit
10.A to Viad Corp’s Form 8-K filed February 13, 2007, is hereby incorporated by reference (SEC
File No. 001-11015; SEC Film No. 07609762).+
Copy of Employment Agreement between Viad Corp and Paul B. Dykstra dated as of May 15,
2007, filed as Exhibit 10.B to Viad Corp’s Form 8-K filed May 21, 2007, is hereby incorporated
by reference (SEC File No. 001-11015; SEC Film No. 07867527).+
Copy of Amendment No. 1 to Employment Agreement between Viad Corp and Paul B. Dykstra
effective as of February 27, 2013, filed as Exhibit 10.A to Viad Corp’s Form 8-K filed March 5,
2013, is hereby incorporated by reference.+
Copy of Severance Agreement (No Change in Control) between Viad Corp and Steven W.
Moster, effective as of December 3, 2014, filed as Exhibit 10.B to Viad Corp’s Form 8-K filed
December 5, 2014, is hereby incorporated by reference.+
Copy of Viad Corp Supplemental TRIM Plan, as amended and restated effective January 1, 2005
for Code Section 409A, filed as Exhibit 10.E to Viad Corp’s Form 8-K filed August 29, 2007, is
hereby incorporated by reference (SEC File No. 001-11015; SEC Film No. 071088413).+
Copy of Viad Corp Supplemental Pension Plan, amended and restated as of January 1, 2005 for
Code Section 409A, filed as Exhibit 10.A to Viad Corp’s Form 8-K filed August 29, 2007, is
hereby incorporated by reference (SEC File No. 001-11015; SEC Film No. 071088413).+
Copy of Viad Corp Defined Contribution Supplemental Executive Retirement Plan, effective as of
January 1, 2013, filed as Exhibit 10.E to Viad Corp’s Form 8-K filed March 5, 2013, is hereby
incorporated by reference.+
10.G1
10.G2
10.H
10.I
14
21
23
24
31.1
31.2
32.1
32.2
Summary of Compensation Program of Non-Employee Directors of Viad Corp as of January 1,
2012, filed as Exhibit 10.G1 to Viad Corp’s 2011 Form 10-K filed March 9, 2012, is hereby
incorporated by reference.+
Description of Viad Corp Director’s Matching Gift Program, filed as Exhibit 10.Q to Viad Corp’s
1999 Form 10-K filed March 17, 2000, is hereby incorporated by reference (SEC File No.
001-11015; SEC Film No. 572329).+
Copy of form of Indemnification Agreement between Viad Corp and Directors of Viad Corp, as
approved by Viad Corp stockholders on October 16, 1987, as updated to reflect revised company
name and gender-neutral references only, and filed as Exhibit 10.I to Viad Corp’s 2008 Form 10-K
filed February 27, 2009, is hereby incorporated by reference (SEC File No. 001-11015; SEC Film
No. 09642683).+
Copy of Retirement Plan for Management Employees of Brewster Inc., as amended and restated
effective January 1, 2010, and filed as Exhibit 10.J to Viad Corp’s 2009 Form 10-K filed March 8,
2010, is hereby incorporated by reference (SEC File No. 001-11015; SEC Film No. 10664160).+
Copy of Code of Ethics of Viad Corp adopted May 13, 2003, filed as Exhibit 14 to Viad Corp’s
2003 Form 10-K filed March 11, 2004, is hereby incorporated by reference (SEC File No.
001-11015; SEC Film No. 04663620).
List of Subsidiaries of Viad Corp.*
Consent of Independent Registered Public Accounting Firm to the incorporation by reference into
specified registration statements on Form S-3 or on Form S-8 of their report contained in this
Annual Report.*
Power of Attorney signed by Directors of Viad Corp.*
Exhibit of Certification of Chief Executive Officer of Viad Corp pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.#*
Exhibit of Certification of Chief Executive Officer of Viad Corp pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.#*
Additional Exhibit of Certification of Chief Executive Officer of Viad Corp pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.#**
Additional Exhibit of Certification of Chief Financial Officer of Viad Corp pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.#**
101.INS
XBRL Instance Document.*
101.SCH XBRL Taxonomy Extension Schema Document.*
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document.*
101.DEF XBRL Taxonomy Extension Definition Linkbase Document.*
101.LAB XBRL Taxonomy Extension Label Linkbase Document.*
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document.*
*
**
+
#
Filed herewith.
Furnished herewith.
Management contract or compensation plan or arrangement.
A signed original of this written statement has been provided to Viad Corp and will be retained by Viad
Corp and furnished to the Securities and Exchange Commission upon request.
Documents incorporated by reference can be read and copied at the SEC’s public reference section,
located in Room 1580, 100 F Street, N.E., Washington, DC 20549, and on the SEC’s Internet site at
www.sec.gov.
[THIS PAGE INTENTIONALLY LEFT BLANK]
VIAD CORP BOARD OF DIRECTORS
(cid:90)(cid:349)(cid:272)(cid:346)(cid:258)(cid:396)(cid:282)(cid:3)(cid:44)(cid:856)(cid:3)(cid:24)(cid:381)(cid:460)(cid:286)(cid:396)(cid:3)(1,3)
(cid:4)(cid:374)(cid:282)(cid:396)(cid:286)(cid:449)(cid:3)(cid:17)(cid:856)(cid:3)(cid:17)(cid:286)(cid:374)(cid:286)(cid:425)(cid:3)(2,4)
Daniel Boggan Jr. (2,3)
(cid:24)(cid:396)(cid:856)(cid:3)(cid:47)(cid:400)(cid:258)(cid:271)(cid:286)(cid:367)(cid:367)(cid:258)(cid:3)(cid:18)(cid:437)(cid:374)(cid:374)(cid:349)(cid:374)(cid:336)(cid:346)(cid:258)(cid:373)(cid:3)(1,2,4)
(cid:18)(cid:346)(cid:258)(cid:349)(cid:396)(cid:373)(cid:258)(cid:374)(cid:3)(cid:381)(cid:296)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:17)(cid:381)(cid:258)(cid:396)(cid:282)(cid:853)(cid:3)(cid:115)(cid:349)(cid:258)(cid:282)(cid:3)(cid:18)(cid:381)(cid:396)(cid:393)
(cid:38)(cid:381)(cid:396)(cid:373)(cid:286)(cid:396)(cid:3)(cid:87)(cid:396)(cid:286)(cid:400)(cid:349)(cid:282)(cid:286)(cid:374)(cid:410)(cid:853)(cid:3)(cid:4)(cid:396)(cid:349)(cid:460)(cid:381)(cid:374)(cid:258)(cid:3)
(cid:24)(cid:349)(cid:258)(cid:373)(cid:381)(cid:374)(cid:282)(cid:271)(cid:258)(cid:272)(cid:364)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:104)(cid:94)(cid:3)(cid:4)(cid:349)(cid:396)(cid:449)(cid:258)(cid:455)(cid:400)(cid:3)
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Edward E. Mace (1,3)
Steven W. Moster
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Margaret E. Pederson (2,3,4)
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BOARD COMMITTEES
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Dr. Albert M. Teplin (1,2)
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MARKETING
EVENTS
&
GROUP
SPECIALISTS IN THE ART AND SCIENCE
OF ENGAGEMENT
There’s more to a successful event than meets the
eye. As a global full-service provider for live events,
GES uniquely combines the art of high-impact cre-
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more engagement at their events.
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GES partnered with new Corporate
Event client Mary Kay to create a
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experience at its annual seminar
in 2014.
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global full-service provider for live events. Already
selected by leaders in every segment of live events,
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(cid:393)(cid:258)(cid:374)(cid:455)(cid:3) (cid:410)(cid:346)(cid:258)(cid:410)(cid:3) (cid:272)(cid:258)(cid:374)(cid:3) (cid:393)(cid:396)(cid:381)(cid:448)(cid:349)(cid:282)(cid:286)(cid:3) (cid:272)(cid:367)(cid:349)(cid:286)(cid:374)(cid:410)(cid:400)(cid:3) (cid:410)(cid:346)(cid:286)(cid:349)(cid:396)(cid:3) (cid:373)(cid:381)(cid:400)(cid:410)(cid:3) (cid:272)(cid:396)(cid:349)(cid:415)(cid:272)(cid:258)(cid:367)(cid:3) (cid:286)(cid:448)(cid:286)(cid:374)(cid:410)(cid:3)
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(cid:396)(cid:286)(cid:336)(cid:349)(cid:400)(cid:410)(cid:396)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3) (cid:282)(cid:258)(cid:410)(cid:258)(cid:3) (cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:3) (cid:373)(cid:258)(cid:396)(cid:364)(cid:286)(cid:410)(cid:3) (cid:449)(cid:349)(cid:410)(cid:346)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:258)(cid:272)(cid:395)(cid:437)(cid:349)-
(cid:400)(cid:349)(cid:415)(cid:381)(cid:374)(cid:3) (cid:381)(cid:296)(cid:3) (cid:28)(cid:437)(cid:396)(cid:381)(cid:393)(cid:286)(cid:258)(cid:374)(cid:3) (cid:367)(cid:286)(cid:258)(cid:282)(cid:286)(cid:396)(cid:853)(cid:3) (cid:69)(cid:1006)(cid:1004)(cid:1004)(cid:856)(cid:3) (cid:47)(cid:374)(cid:3) (cid:410)(cid:346)(cid:286)(cid:3) (cid:104)(cid:374)(cid:349)(cid:410)(cid:286)(cid:282)(cid:3) (cid:94)(cid:410)(cid:258)(cid:410)(cid:286)(cid:400)(cid:853)(cid:3)
(cid:39)(cid:28)(cid:94)(cid:3) (cid:258)(cid:272)(cid:395)(cid:437)(cid:349)(cid:396)(cid:286)(cid:282)(cid:3) (cid:367)(cid:286)(cid:258)(cid:282)(cid:349)(cid:374)(cid:336)(cid:3) (cid:286)(cid:448)(cid:286)(cid:374)(cid:410)(cid:3) (cid:258)(cid:272)(cid:272)(cid:381)(cid:373)(cid:373)(cid:381)(cid:282)(cid:258)(cid:415)(cid:381)(cid:374)(cid:400)(cid:3) (cid:272)(cid:381)(cid:373)(cid:393)(cid:258)-
(cid:374)(cid:349)(cid:286)(cid:400)(cid:3)(cid:381)(cid:374)(cid:87)(cid:286)(cid:258)(cid:364)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:100)(cid:396)(cid:258)(cid:448)(cid:286)(cid:367)(cid:3)(cid:87)(cid:367)(cid:258)(cid:374)(cid:374)(cid:286)(cid:396)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:373)(cid:286)(cid:396)(cid:336)(cid:286)(cid:282)(cid:3)(cid:410)(cid:346)(cid:286)(cid:373)(cid:3)(cid:349)(cid:374)(cid:410)(cid:381)(cid:3)
(cid:381)(cid:374)(cid:87)(cid:286)(cid:258)(cid:364)(cid:853)(cid:3)(cid:258)(cid:3)(cid:39)(cid:28)(cid:94)(cid:3)(cid:39)(cid:367)(cid:381)(cid:271)(cid:258)(cid:367)(cid:3)(cid:18)(cid:381)(cid:373)(cid:393)(cid:258)(cid:374)(cid:455)(cid:856)(cid:3)
(cid:39)(cid:28)(cid:94)(cid:3)(cid:393)(cid:258)(cid:396)(cid:410)(cid:374)(cid:286)(cid:396)(cid:400)(cid:3)(cid:449)(cid:349)(cid:410)(cid:346)(cid:3)(cid:400)(cid:346)(cid:381)(cid:449)(cid:3)(cid:381)(cid:396)(cid:336)(cid:258)(cid:374)(cid:349)(cid:460)(cid:286)(cid:396)(cid:400)(cid:853)(cid:3)(cid:286)(cid:454)(cid:346)(cid:349)(cid:271)(cid:349)(cid:410)(cid:381)(cid:396)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:271)(cid:396)(cid:258)(cid:374)(cid:282)(cid:3)
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(cid:381)(cid:299)(cid:286)(cid:396)(cid:349)(cid:374)(cid:336)(cid:3)(cid:258)(cid:3)(cid:272)(cid:381)(cid:373)(cid:393)(cid:367)(cid:286)(cid:410)(cid:286)(cid:3)(cid:396)(cid:258)(cid:374)(cid:336)(cid:286)(cid:3)(cid:381)(cid:296)(cid:3)(cid:400)(cid:286)(cid:396)(cid:448)(cid:349)(cid:272)(cid:286)(cid:400)(cid:853)(cid:3)(cid:296)(cid:396)(cid:381)(cid:373)(cid:3)(cid:410)(cid:346)(cid:286)(cid:3)(cid:282)(cid:286)(cid:400)(cid:349)(cid:336)(cid:374)(cid:3)
(cid:258)(cid:374)(cid:282)(cid:3) (cid:393)(cid:396)(cid:381)(cid:282)(cid:437)(cid:272)(cid:415)(cid:381)(cid:374)(cid:3) (cid:381)(cid:296)(cid:3) (cid:272)(cid:381)(cid:373)(cid:393)(cid:286)(cid:367)(cid:367)(cid:349)(cid:374)(cid:336)(cid:853)(cid:3) (cid:349)(cid:373)(cid:373)(cid:286)(cid:396)(cid:400)(cid:349)(cid:448)(cid:286)(cid:3) (cid:286)(cid:454)(cid:393)(cid:286)(cid:396)(cid:349)(cid:286)(cid:374)(cid:272)(cid:286)(cid:400)(cid:3)
(cid:410)(cid:346)(cid:258)(cid:410)(cid:3) (cid:286)(cid:374)(cid:336)(cid:258)(cid:336)(cid:286)(cid:3) (cid:258)(cid:437)(cid:282)(cid:349)(cid:286)(cid:374)(cid:272)(cid:286)(cid:400)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3) (cid:271)(cid:437)(cid:349)(cid:367)(cid:282)(cid:3) (cid:271)(cid:396)(cid:258)(cid:374)(cid:282)(cid:3) (cid:258)(cid:449)(cid:258)(cid:396)(cid:286)(cid:374)(cid:286)(cid:400)(cid:400)(cid:853)(cid:3) (cid:410)(cid:381)(cid:3)
material handling, rigging, electrical and other on-site
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(cid:286)(cid:448)(cid:286)(cid:374)(cid:410)(cid:400)(cid:3) (cid:258)(cid:374)(cid:282)(cid:3) (cid:336)(cid:437)(cid:286)(cid:396)(cid:396)(cid:349)(cid:367)(cid:367)(cid:258)(cid:3) (cid:373)(cid:258)(cid:396)(cid:364)(cid:286)(cid:415)(cid:374)(cid:336)(cid:856)(cid:3) (cid:90)(cid:286)(cid:410)(cid:258)(cid:349)(cid:367)(cid:286)(cid:396)(cid:400)(cid:3) (cid:393)(cid:258)(cid:396)(cid:410)(cid:374)(cid:286)(cid:396)(cid:3) (cid:449)(cid:349)(cid:410)(cid:346)(cid:3)
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(cid:271)(cid:396)(cid:258)(cid:374)(cid:282)(cid:286)(cid:282)(cid:3) (cid:286)(cid:454)(cid:393)(cid:286)(cid:396)(cid:349)(cid:286)(cid:374)(cid:272)(cid:286)(cid:400)(cid:3) (cid:410)(cid:346)(cid:258)(cid:410)(cid:3) (cid:282)(cid:396)(cid:349)(cid:448)(cid:286)(cid:3) (cid:410)(cid:396)(cid:258)(cid:312)(cid:272)(cid:853)(cid:3) (cid:271)(cid:437)(cid:349)(cid:367)(cid:282)(cid:3) (cid:271)(cid:396)(cid:258)(cid:374)(cid:282)(cid:3)
(cid:258)(cid:449)(cid:258)(cid:396)(cid:286)(cid:374)(cid:286)(cid:400)(cid:400)(cid:3)(cid:258)(cid:374)(cid:282)(cid:3)(cid:349)(cid:373)(cid:393)(cid:396)(cid:381)(cid:448)(cid:286)(cid:3)(cid:400)(cid:258)(cid:367)(cid:286)(cid:400)(cid:856)
TRAVEL
&
GROUP
RECREATION
PASSIONATE DESTINATION EXPERTS
(cid:115)(cid:349)(cid:258)(cid:282)(cid:859)(cid:400)(cid:3)(cid:100)(cid:396)(cid:258)(cid:448)(cid:286)(cid:367)(cid:3)(cid:920)(cid:3)(cid:90)(cid:286)(cid:272)(cid:396)(cid:286)(cid:258)(cid:415)(cid:381)(cid:374)(cid:3)(cid:39)(cid:396)(cid:381)(cid:437)(cid:393)(cid:3)(cid:296)(cid:381)(cid:272)(cid:437)(cid:400)(cid:286)(cid:400)(cid:3)(cid:381)(cid:374)(cid:3)(cid:258)(cid:400)(cid:400)(cid:286)(cid:410)(cid:400)(cid:3)(cid:400)(cid:286)(cid:410)(cid:3)(cid:349)(cid:374)(cid:3)(cid:349)(cid:272)(cid:381)(cid:374)(cid:349)(cid:272)(cid:3)
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ALASKA DENALI TRAVEL
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Executive Officers
Transfer Agent
Steven W. Moster
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Deborah J. DePaoli
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Ellen M. Ingersoll
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Thomas M. Kuczynski
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Leslie S. Striedel
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Kelly Smith Dotson
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inquiries regarding dividend payments, to mail
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Wells Fargo Shareowner Services
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accounts consolidated.
Shareholder Information
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May 21, 2015
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The Ritz Carlton
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