Viad Corp (NYSE:VVI) Q2 2023 Earnings Call Transcript

So we won’t comment on any specifics other than, I would say that the climate is robust and there are multiple opportunities, and we remain focused on really digging through and picking the absolute best ones.

Bryan Maher: And as it relates to FlyOver Chicago, I think, I had made a note that does that open next March? Is that still on track for next year in this March of the month?

David Barry: Yes. March is the month. And I would say, just one of the things we’ve been able to do, Bryan, this summer is observe what’s happening at Navy Pier. So, Navy Pier has had a tremendously positive second quarter and then obviously a very, very strong July. And so we think the way that the Navy Pier works in Chicago, the fact that there’s joint ticketing between the attractions, there’s one ticketing system, and hosting significantly high numbers of visitors that the opportunity to work together as a destination is a powerful one, and it’s something that we’re excited about getting open. So we’re on track on plan within capital and ready to open in March of 2024.

Operator: Your next question comes from the line of Alex Fuhrman from Craig-Hallum Capital Group.

Alex Fuhrman: Hey, guys. Thanks very much for taking my question. David I was interested to hear your commentary. It sounds like the Banff Gondola is on track for a record year of visitation this year. It seems like from looking at a lot of the reviews online that the demand for that attraction remains incredibly strong, but it seems like parking is a little bit of the bottleneck there. Can you talk a little bit about what you’re doing to get more people through that attraction? And as you think about next year and the following year, are there opportunities to continue to get visitation up beyond the record levels you’re seeing this year?

David Barry: Yes, that’s a great question. Thanks, Alex. So, a couple of things. One is in any national park town you obviously have parking constraints, because you have the size of the community and I’ll pick Banff an example, where you’ve got a number of residents that are there an amount of parking. And so there’s a couple of initiatives that happen across town completely. And that’s one, free shuttles where guests can park their car in a central location and then shuttle up to the Banff Gondola free of charge. And we run a series of those services as well as the town advance and the regional transportation authority. So that’s helped alleviate any of the concerns for parking that you have in that particular location. And you are quite correct.

We are on track for a record season in terms of visitation at the Banff Gondola, and we’re excited about that. Into the future, peak times are peak times, and you reach a certain capacity where you’ve achieved your effective carrying capacity, but there remains who can visit when seeking what experience different times of the day. So if you’re a parent with young kids, and they’re up early in the morning, that’s a great time to visit early in the morning. And obviously at peak times in the afternoon, between say 1:00 and 4:00 p.m. that’s when you’re most constrained. So we continue to have availability what we call white space earlier in the day and then depending on the season. And so there’s room within our operating season because again we operate on a 12-month basis to grow both volume of passengers and capacity.

And generally it will expand into the various hours of the day. And so with the right mix of programming and dynamic pricing we see continued opportunity for growth there.

Alex Fuhrman: Okay. That’s really helpful. Thank you, David. And then, can you talk a little bit about what you’re seeing so far in terms of the pipeline for international group travel next year? I think there was an article just in this morning’s Wall Street Journal about how very few Americans are traveling overseas to China right now and mentioned the difficulty of just simply flights between North America and China. Do you have any sense of what that might look like next year? And then, it sounds like you’re seeing a lot of increased demand from international tour groups outside of China maybe countries like India and Korea. Is there an opportunity to perhaps make up for the Chinese traveler if flights just don’t come back next year?

David Barry: Yes. Again another good question. So we have a combination of what we call source markets. And so we work in basically 80 countries around the world, where tour and travel partners are coming to Western Canada to experience what Western Canada has to offer. Each of them contracts multiple years out. So we have commitments from tour and travel partners for 2024 and 2025 at this point as people are contracting multi years ahead. Definitely I would say that demand is quite robust for 2024 and 2025. And then what remains to be seen is can people obtain say, from China exit Visas and will the amount of flights, the number of flights return to say 2019 levels. Today they’re not there. And part of the reason is that the Chinese government opened up the markets quite late in the journey.