Emerald Holding(EEX) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for Q4 2024 was $106.8 million, up from$ 101.5 million in the prior year quarter, driven by organic revenue growth of $6.1 million or 6.5% [28][29] - Full-year revenue totaled$ 398.8 million, an increase of 4.2% versus the prior year, with organic revenue growth of $21.3 million or 5.9% [30] - Adjusted EBITDA for Q4 was$ 32.6 million compared to $35.8 million in the prior year quarter, while full-year adjusted EBITDA was$ 100.2 million, up from $95 million in the prior year [32][33] Business Line Data and Key Metrics Changes - The company launched an aggressive portfolio optimization effort in 2024, pruning unprofitable events and establishing a more nimble portfolio for growth [6][22] - The acquisitions of This is Beyond and Insurtech Insights are expected to contribute approximately$ 40 million in revenue and $15 million in adjusted EBITDA in 2025 [19][39] Market Data and Key Metrics Changes - The luxury travel market is highlighted as a key growth area, with 85% of luxury travelers considering travel advisors crucial for securing personalized experiences [12] - The insurance technology industry is projected to grow at a CAGR of 5% to 6% globally through 2030, indicating strong market potential for Insurtech Insights [17][18] Company Strategy and Development Direction - The company is focused on three pillars of value creation: customer centricity, 365-day engagements, and portfolio optimization [21] - The strategy includes expanding into high-growth sectors, particularly luxury and technology-oriented events, to enhance margins and growth [7][41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the portfolio and the resilience of the team, anticipating improved growth and margin enhancements in 2025 [8][26] - The ongoing construction at the Las Vegas Convention Center is expected to impact certain events but is projected to be completed by the end of 2025, leading to improved customer experiences in 2026 [24][94] Other Important Information - The company successfully refinanced its debt, enhancing financial flexibility and reducing financing costs by 125 basis points [20][44] - A quarterly dividend of$ 0.15 per share was declared, reflecting a dividend yield of 1.6% based on the closing price [47] Q&A Session Summary Question: How are the acquisitions being funded? - The acquisitions are funded with cash on hand, with deferred components based on performance through 2027 [56] Question: What is the expected annualized revenue and EBITDA from the acquisitions? - The expected annualized impact of the acquisitions is built into the guidance, with a moderate shift in seasonality anticipated [59][62] Question: Are the EBITDA figures provided pre or post-synergies? - The EBITDA figures are pre-synergies, with potential synergies expected to materialize in 2026 and beyond [73] Question: What is the outlook for free cash flow conversion? - The company expects free cash flow of $50 million plus, indicating a positive step forward in conversion from EBITDA [81] Question: Will there be further portfolio optimization in 2025? - Continuous assessment of the portfolio will occur, with actions taken if underperforming elements are identified [102]