By Eric Smith
Revenue for the recent Outdoor Retailer Snow Show is expected to be down in the mid-single digits even as the show’s mood and energy were “excellent,” according to Phil Evans, interim president and CEO of Outdoor Retailer parent company Emerald Expositions Events Inc.
That was the assessment Evans provided of the event—held January 30 to February 1 at the Colorado Convention Center in Denver—during Thursday morning’s earnings conference call with analysts to discuss Emerald’s fourth-quarter results.
Despite the revenue dip for Snow Show (click here to read our recap), it’s not all bad news for San Juan Capistrano, CA-based Emerald and Outdoor Retailer. Three months ago, when Emerald reported Q3 earnings, Evans said the company was lowering organic revenue guidance for the year because of a “reduction in our expectations for the new Outdoor Retailer November show.”
Winter Market was indeed slow, painfully so for many of the exhibitors and attendees who shared their concerns with SGB Media during and after the event (click here to read our takeaways from the show).
However, fast forward to fourth quarter’s financial performance and now Evans refers to Outdoor Retailer Winter Market as one of “several successful launches” for Emerald during the period.
The two shows combined—November’s Winter Market and January’s Snow Show—are projected to post a 40 percent revenue bump from OR’s 2017/18 winter schedule of just one show. Emerald bought Snow Show from Snowsports Industries America in 2017 and only hosted that one event last winter.
Evans is even bullish on OR’s new three-show schedule of Snow Show in January, Summer Market in June and Winter Market in November. That cadence, which is tied into the buying cycles, is what show director Marisa Nicholson has been hoping would catch on with industry stakeholders based on their feedback.
“This is the schedule that serves everyone’s market needs,” she told SGB last year.
Evans, who sounded doubtful on last November’s Q3 earnings call, now seems to echo Nicholson’s confidence that hosting the three Outdoor Retailer events in those time slots makes the most sense.
“[O]ur industry customers are adopting the three-show format to meet product development and introduction decision needs,” Evans said on Thursday’s call. “The mood and the energy of the show floor [at Snow Show] was excellent and we received strong positive feedback from many exhibitors and attendees.”
He is now projecting a slight revenue boost from the 2019 shows compared to last year’s lineup, and he called out by name two prominent outdoor brands that didn’t exhibit in November but have registered for this year’s Winter Market as a sign of better days ahead.
“We expect the three Outdoor Retailer shows to be slightly positive in revenue in aggregate versus 2018, as the prior year included the large single winter event in January 2018 and also benefited from the new November event,” he said. “It’s encouraging that we’ve received early orders for the November 2019 show from several influential brands, including Patagonia and The North Face, neither of whom participated in the inaugural 2018 event.”
During the earnings call, Evans commented briefly on Interbike, which Emerald canceled for 2019. He said Interbike was the largest of the shows that the company held in 2018 but won’t this year. In aggregate, he said, those canceled events contributed $6.2 million in revenue in 2018 and an estimated $2.5 million in adjusted EBITDA.
Companywide, Emerald reported revenues for the fourth quarter increased 81 percent to $57 million, compared to $31.5 million for fourth quarter 2017 and ahead of Wall Street’s expectations by $3.5 million.
The company reported a net loss of $90 million in the fourth quarter as it took $104.3 million in impairment charges related to certain trade names and customer-related intangible assets. However, earnings per share of $0.00 beat estimates by 2 cents.
Read more: Emerald Expositions Posts Q4 Loss On Impairment Charges
For the year, Emerald reported revenues increased 11.4 percent to $380.7 million, and it reported a net loss of $25.1 million, compared to net income of $81.8 million for the full-year 2017. The 2018 net loss included a non-cash charge of $104.3 million related to the impairment of certain intangible assets
Looking ahead, for the year ending December 3, 2019, Emerald management expects a total revenue decline of 0.7 percent to growth of 2.5 percent, or revenue in a range of $378 million to $390 million, including “slight revenue growth in our three-show Outdoor Retailer franchise.”
And the company projects adjusted net income in the range of $76 million to $88 million, representing a decrease in the range of 12.2 percent to 24.2 percent compared to 2018. Adjusted diluted EPS is expected to be in the range of $1.02 to $1.20, representing a decrease of 9.8 percent to 23.3 percent compared to 2018.
Photo courtesy Outdoor Retailer
[author] [author_image timthumb=’on’]https://s.gravatar.com/avatar/dec6c8d990a5a173d9ae43e334e44145?s=80[/author_image] [author_info]Eric Smith is Senior Business Editor at SGB Media. Reach him at eric@sgbonline.com or 303-578-7008. Follow on Twitter or connect on LinkedIn.[/author_info] [/author]
