Emerald Holding, Inc. Q1 FY2025 earnings call

• Strong first quarter performance with double-digit revenue and adjusted EBITDA growth, building on portfolio optimization initiatives from 2024.
• Key events like Kbiz, Prosper Show, and International Pizza Expo showcased breadth and depth of industry reach, with positive attendee feedback.
• Received regulatory approval to acquire This Is Beyond, planning to close in coming days, with its events expected to show strong growth. Also, InsureTech Insights acquisition closed in March, with its European event in London having strong turnout.
• Refinanced debt in January 2025, enhancing financial flexibility with well-staggered debt maturities.
• Board reauthorized share buyback program with an additional $25 million and approved quarterly dividend of $0.015 per share.

Total revenue for the first quarter was $147.7 million compared to $133.4 million in the prior year quarter. Organic revenue increased 5.6% year-over-year to $139.2 million, driven by a 6.6% growth in the connections business. First quarter adjusted EBITDA, excluding insurance proceeds, was $53.6 million compared to $39.8 million in the prior year period, an increase of 34.7%, resulting in an adjusted EBITDA margin of approximately 36.3%. SG&A expenses were $54.1 million versus $55.5 million in the prior year quarter, with a year-over-year decline due to lower compensation and travel expenses offset by incremental expenses from acquisitions. Free cash flow was $10.8 million excluding event cancellation insurance, compared to $3.8 million in the prior year period. Internationally, approximately 10% of total revenue is generated from international exhibitors, with China accounting for ~2%, Canada ~2%, and Mexico <1% of revenue from relevant companies.

• Remain on track to achieve full year 2025 guidance of $450 million to $460 million in revenue and $120 million to $125 million in adjusted EBITDA.
• Guidance accounts for potential impact of tariffs imposed and threatened by the U.S. government, with proactive sales efforts in new markets to manage the situation.

• Impact of global trade disruptions and geopolitical dynamics on international business, including declines in exhibitors and visitors from China and Canada.
• Shifting consumer sentiment and economic pressures affecting business performance.
• Uncertainty around trade tariffs and their potential impact on international exhibitor sales and attendance.

Q: Drilled down on guidance assuming trade war potential impacts, asked if seeing international attendance fall off and consistency with guidance.

A: Herve Sedky said seeing declines expected from Canada and China, but increasing sales from countries like Turkey, UAE, and Brazil. David Doft noted international revenues were factored in initial budget as a buffer, with smaller impact due to vast majority of portfolio being domestic.

Q: Asked about EBITDA from InsureTech, schedule of InsureTech events, and This Is Beyond funding.

A: InsureTech had an event in the quarter, London and New York events similar in size, Hong Kong event smaller. This Is Beyond to be funded from cash on balance sheet. InsureTech queue to be released shortly.

Q: Asked about expense discipline going forward.

A: Herve Sedky mentioned consolidating businesses onto Emerald platform for efficiencies, testing AI applications for effectiveness and efficiency, and focusing on procurement to increase buying power and achieve savings.