Emerald Holding(US:EEX)2022-02-24 16:34Financial Data and Key Metrics Changes - The company reported revenues of $41.1 million for Q4 2021, a significant increase from $12.2 million in the same quarter of the previous year, primarily due to $21.7 million in revenues from live events staged in Q4 2021 that were canceled in Q4 2020 due to COVID [11] - Organic revenues for Q4 2021 were $12.1 million, up from $9.4 million in the prior-year period, driven by a $1.9 million increase in print and digital advertising revenues [11] - Adjusted EBITDA for Q4 2021 was $52.6 million compared to $18.3 million in the same period last year, largely due to profits from live events and $59.9 million in other income from event cancellation insurance claims [11][12] Business Line Data and Key Metrics Changes - The company staged 63 live events in the past year, serving over 129,000 attendees and 7,500 exhibiting customers, with attendance declines improving from 50%-60% to 35%-45% compared to pre-COVID levels [4][5] - The acquisition of MJBiz, a leading B2B media company in the cannabis industry, is expected to contribute significantly to revenue growth, having generated $27 million in revenue in 2021 [6][14] - The Elastic SaaS platform saw a 24% growth in new customer additions, with a net revenue retention rate of 102% [7] Market Data and Key Metrics Changes - The company noted that attendance at events is recovering, with the largest domestic trade show since the pandemic drawing approximately 70,000 attendees [4] - The company is seeing improved cash collections and forward bookings, indicating a positive trend in the recovery of the event sector [12][29] Company Strategy and Development Direction - The company is focused on a three-pronged growth strategy: portfolio optimization, 365-day engagements, and customer centricity, aiming to diversify its business and accelerate sales growth [6][10] - New trade shows are being launched in high-growth industries, with plans for two new shows in 2022 and three more approved for 2023 [8] - The company aims to enhance its digital offerings and customer engagement through its Elastic platform and content assets [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery of live events and expects to achieve fiscal year 2022 revenues in excess of $300 million and adjusted EBITDA exceeding $50 million [16] - The company anticipates continued improvements in attendance and profitability as the recovery progresses, with expectations to exceed pre-COVID attendance levels by 2023-2024 [5][16] - Inflation is being monitored closely, with strategies in place to manage costs and maintain pricing power based on the value delivered to customers [30] Other Important Information - The company ended 2021 with $231.2 million in cash and full availability of a $110 million revolving credit facility, providing significant liquidity for future investments [14] - The company has submitted $249.1 million in total claims for event cancellation insurance, with $184.4 million received to date [12] Q&A Session Summary Question: Comments on M&A activity and pricing - Management noted a wide range of multiples in the M&A market, with smaller deals in the mid-single-digit EBITDA range and larger, high-growth assets in the high single-digit range [20] - The company has been able to improve pricing at events based on the value provided, leveraging enhancements like matchmaking to justify price increases [23] Question: Attendee and exhibitor dynamics - Management indicated that while attendee numbers are recovering well, exhibitor participation has lagged due to uncertainties about attendance and ROI [27][28] - Forward bookings are improving, but some exhibitors are waiting longer to commit due to ongoing uncertainties [29] Question: Impact of inflation - Management is actively managing inflation through a new procurement function and is focused on delivering value to maintain pricing power [30]