EX-99.2 3 eex-ex99_2.htm EX-99.2

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Emerald Holding, Inc. Second Quarter 2024 August 7, 2024 Exhibit 99.2


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Legal Disclaimer Forward-Looking Statements The information provided in this presentation is for general informational purposes only. This presentation contains certain forward-looking statements regarding Emerald Holding, Inc. and its subsidiaries (the “Company”), including, without limitation, statements regarding the Company’s ability to continue staging live events and scale its business beyond pre-COVID levels; statements about general economic conditions, or more specifically about the markets in which the Company operates, and the Company’s expectations, beliefs, plans, strategies, objectives, prospects, assumptions or future events or performance; the multiple avenues to return to organic growth; expectations regarding interest rates and economic conditions and the Company’s 2024 financial guidance expectations; the Company’s ability to successfully identify and acquire acquisition targets; and the Company’s intention to continue to pay regular quarterly dividends, among others. In particular, the declaration, timing and amount of any future dividends will be subject to the discretion and approval of the Company’s Board of Directors, and will depend on a number of factors. The forward-looking statements contained herein are based on management’s current expectations as well as estimates and assumptions prepared by management as of the date hereof, and although they are believed to be reasonable, they are inherently uncertain and not guaranteed. These statements involve risks and uncertainties outside of the Company’s control that may cause actual results, performance, or achievements, to differ materially and there can be no assurance that the projected results and forward-looking statements in this presentation will prove to be accurate. In addition, even if our results of operations, financial condition and liquidity, and events in the industry in which we operate, are consistent with the forward-looking statements contained in this report, they may not be predictive of results or developments in future periods. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Forward looking statements include all statements that are not historical facts and can be identified by terms such as “anticipate,” “believe, “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” or “would” or similar expressions and the negatives of those terms. For factors that could cause actual results to differ materially from the forward-looking statements in this presentation, please see the risks and uncertainties identified under the headings “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s most recently filed annual report on Form 10-K for the year ended December 31, 2023, which is available on the Company’s Investor Relations website at investor.emeraldx.com and on the SEC’s EDGAR website at www.sec.gov. The Company disclaims any obligation to update or revise any of the forward-looking statements contained herein, whether as a result of new information, future events or otherwise. Past results are not indicative of future performance. Industry and Market Information To the extent this presentation includes information concerning the industry and the markets in which the Company operates, including general observations, expectations, market position, market opportunity and market size, such information is based on management's knowledge and experience in the markets in which the Company operates, including publicly available information from independent industry analysts and publications, as well as the Company’s own estimates. The Company’s estimates are based on third-party sources, as well as internal research, which the Company believes to be reasonable, but which are inherently uncertain and imprecise. Accordingly, you are cautioned not to place undue reliance on such market and industry information. Non-GAAP Financial Information This presentation also includes certain non-GAAP financial measures. These non-GAAP financial measures are in addition to, and should not be considered as a substitute for or superior to, measures of financial performance prepared in accordance with generally accepted accounting principles (“GAAP”). The non-GAAP measures included herein may be different from similarly titled non-GAAP measures used by other companies. A reconciliation is provided herein for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Readers are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures.


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Participants Hervé Sedky President and Chief Executive Officer David Doft Chief Financial Officer


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Key Q2 2024 Takeaways Continued year-over-year growth during seasonally slower second quarter. Strong re-booking trends provide forward visibility and support reiterated outlook of $415 to $425 million in Revenue and $110 to $115 million in Adjusted EBITDA in FY 2024 Target to expand Adj. EBITDA margins from ~27% implied in 2024 guidance to historical levels over time Initiated quarterly dividend of $0.015 per share based on strong, sustained cash flow generation Diversified portfolio across multiple sectors with countercyclical benefits Continue to generate positive free cash flow, supported by low CapEx requirements and working capital dynamics of events business where cash is collected in advance of an event staging


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Revolutionizing the Trade Show Model Integrating technology and first party data to create a next-generation B2B platform Collection of leading B2B trade shows and conferences that bring together industry-specific communities Revenue is generated from the production of trade shows and conference events, including booth space sales, registration fees and sponsorship fees Emerald’s Core Services B2B websites and publications that provide industry specific business news and information across 20 sectors Revenue primarily consists of advertising sales for industry publications and digital products SaaS software enables year-round B2B buying and selling which averages $1 billion per month of wholesale gross transaction volume Revenue consists of subscription revenue, implementation fees and professional services Connections (89% of FY 2023 Revenue) Content Commerce


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Enduring Value of Trade Shows (1) Source: Freeman, New Freeman Research Shows an Accelerated Return to In-Person Events. (2) Source: TSL, 2023 150+ Trade Show Stats That Reveal All. (3) Source: CEIR, Omnichannel Marketing Insights Report 1. (4) Source: Gartner, What Marketing Budgets Look Like in 2022. (5) Source: PwC, Global Entertainment & Media Outlook 2022-2026. In-person trade shows and events continue to be an integral part of businesses’ marketing budgets and among the highest ROI Generate leads and sales Introduce new products Build brands Strengthen relationships Educate the market Service customers Fulfill procurement needs Source new suppliers Reconnect with existing suppliers Identify trends Learn about new products / services Network with industry peers Value to Exhibitors Value to Attendees 85% of respondents say in-person events are irreplaceable because of their ability to drive commerce and networking that creates partnerships and innovation(1) 5:1 ROI for 14% of Fortune 500 companies from their trade show exhibitions(2) 40% of businesses say B2B exhibitions provide the highest value for their marketing objectives(3) 18% of Chief Marketing Officers cite customer acquisition, retention and engagement as their #1 priority in 2022, up from 10% in 2021(4) 17.6% 2021-2026 CAGR projected for B2B trade show market size(5)


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Three Pillars of Value Creation Emerald’s focus is on maximizing value of operations and expanding offerings Action the holistic consolidated customer database 3-year brand operating plans across portfolio Value-based pricing structure Rigorous, perpetual brand reviews Improved customer retention Higher revenue per customer Focused investment in evolving brands Optimized event success and customer ROI Customer Centricity Emerald Xcelerator Targeted accretive M&A Partnership opportunities New event and content launches in growth categories Platform acquisitions in new growth categories Tuck-in acquisitions in existing strategic categories Portfolio Optimization Daily content and insights across 20 industries Scaled B2B marketplace Increased cadence of online offerings New revenue streams Powerful first-party data Improved cross selling efforts 365-Day Engagement


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Acquisitions and New Event Launches Driving Portfolio Optimization Strategic expansion into high growth industries and categories Select New Event Launches from Xcelerator New Event Launches Expected to Contribute 1-2 Percentage Points of Organic Revenue Growth per Year Educational platform that bridges business and Web3 innovation Will host second iteration at Retail Innovation Conference and Expo (RICE) with a focus on retail sector applications Returned June 2023 B2B event dedicated to the Latin food and beverage sector Strengthens Emerald’s portfolio of leading food & beverage brands Launched in Sept. 2023 Social 3rd Party Digital Recent Acquisitions Leading B2B media company in the cannabis industry with portfolio of media brands + widely attended annual expo B2B e-commerce SaaS platform Premier global B2B event and thought leadership platform with a global presence Leading product database and integrator service provider for commercial AV Leading national trade show focused on educational spaces and equipment Subscription-based photography business education and e-learning service + conference Wholesale online marketplace platform to be combined with Emerald’s iconic NY NOW brand Producer of Overland Expo adventure travel shows Launched in May 2022 New business unit dedicated to launching dynamic brands in emerging and high-growth markets Focused on new brands with an expected run rate of 4 – 6 shows per year Producer of hosted buyer events serving the hospitality, senior living and casino industries via the BITAC series of events. Launched in Sept. 2023 Trade show centered on commercial integration channel service providers across fast-growing verticals. Co-located with Emerald’s popular CEDIA Expo


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9 Adj. EBITDA(1) Free Cash Flow(2) Net Income (Loss) Diluted Income (Loss) Per Share ($ in Millions) ($ in Millions) (1) See slide 14 of this presentation for a reconciliation of Net Income (Loss) to Adjusted EBITDA and Adjusted EBITDA excluding event cancellation insurance proceeds. (2) The calculation of second quarter 2024 Free Cash Flow excluding event cancellation insurance proceeds, net, includes non-recurring acquisition related transaction costs of $0.9 million, acquisition integration, restructuring-related transition costs of $1.0 million, and non-recurring legal, audit and consulting fees of $0.7 million. The calculation of second quarter 2023 Free Cash Flow excluding event cancellation insurance proceeds, net, includes non-recurring financing fees charged to interest expense of $2.1 million, acquisition related transaction costs of $0.2 million, integration-related transition costs of $0.8 million, and non-recurring legal and consulting fees of $0.4 million. The total of these items is $2.6 million and $3.5 million for the quarters ended June 30, 2024 and 2023, respectively. See slide 15 of this presentation for a reconciliation of Free Cash Provided by Operating Activities to Free Cash Flow and Free Cash Flow excluding event cancellation insurance proceeds, net. (3) Consolidated trailing twelve month EBITDA as of June 30, 2024 as defined in Amended and Restated Senior Secured Credit Facilities. Debt includes outstanding gross balance of term loan. Earnings Results Revenues of $86.0 million Diluted loss per share of $(0.03) Net loss of $(2.8) million Adjusted EBITDA of $15.3 million(1) Free cash flow of $7.1 million(2) Highlights and Developments Initiated quarterly dividend of $0.015 per share Completed the conversion of all outstanding preferred shares to common stock, resulting in a simpler capital structure Balance Sheet (as of 6/30/2024) $193.2 million of cash and cash equivalents and full availability on $110 million revolver. Net debt of $218.0 million, including $411.2 million outstanding term loan balance Net debt / EBITDA(3) of 2.1x as of June 30th Approximately 203.9 million common shares outstanding Emerald experienced year over year growth in revenue and Adjusted EBITDA across all categories ($ in Millions) Q2 2024 Financial Highlights and Current Liquidity Position ($0.78)


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10 ($ in Millions) Revenue and Adjusted EBITDA by Segment Quarterly Connections $66.1 $30.5 $88.6 $60.7 $51.4 $81.9 $112.2 $75.6 $62.1 $90.3 $123.4 $75.0 All Other $10.4 $10.6 $9.9 $10.7 $11.0 $11.7 $10.1 $10.9 $10.4 $11.2 $10.0 $11.0 Total $76.5 $41.1 $98.5 $71.4 $62.4 $93.6 $122.3 $86.5 $72.5 $101.5 $133.4 $86.0 Connections $106.7 $282.6 $340.2 All Other $38.8 $43.3 $42.6 Total $145.5 $325.9 $382.8 Annual Connections $18.2 $61.4 $61.0 $27.3 $14.4 $30.3 $49.4 $25.1 $22.6 $39.7 $56.1 $26.4 All Other $1.9 $0.7 ($0.3) $0.7 ($0.3) $0.1 ($0.3) $1.0 $1.3 $1.6 $0.2 $1.8 Corporate ($10.7) ($11.1) ($11.4) ($12.4) ($13.0) ($5.4) ($12.6) ($11.5) ($13.1) ($5.5) ($15.5) ($12.9) Adj. EBITDA $9.4 $51.0 $49.3 $15.6 $1.1 $25.0 $36.5 $14.6 $10.8 $35.8 $40.8 $15.3 Less: Insurance Proceeds $1.2 $59.7 $23.7 $8.1 $2.4 -- -- -- $2.8 -- $1.0 -- Adj. EBITDA ex-Insurance $8.2 ($8.7) $25.6 $7.5 ($1.3) $25.0 $36.5 $14.6 $8.0 $35.8 $39.8 $15.3 Revenue Adjusted EBITDA Connections $80.0 $133.0 $136.8 All Other $6.3 $0.2 $3.6 Corporate ($42.1) ($42.2) ($42.6) Adj. EBITDA $44.1 $91.0 $97.8 Less: Insurance Proceeds $77.4 $34.2 $2.8 Adj. EBITDA ex-Insurance ($33.3) $56.8 $95.0 Adjusted EBITDA Revenue


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11 2024 Guidance Signals Continued Growth and Margin Expansion Revenue ($ in Millions) Adjusted EBITDA ex-Insurance(1) ($ in Millions) $415 to $425 Guidance On average, revenue per event is progressing toward normalized levels Guidance implies ~27% Adj. EBITDA margins, with room for continued improvement to pre-COVID margins over time 2024 Guidance FY 2024 Revenue expected in the range of $415 to 425 million FY 2024 Adjusted EBITDA(1) expected in the range of $110 to 115 million (1) See slide 14 of this presentation for a reconciliation of Net (Loss) Income to Adjusted EBITDA and Adjusted EBITDA excluding event cancellation insurance proceeds. $110 to $115 Guidance


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Defined as the ratio of net debt to consolidated trailing twelve month EBITDA as defined in Amended and Restated Senior Secured Credit Facilities. Annual Recurring Dividends Re-introduce recurring quarterly cash dividend given free cash flow generative nature of business Gradually increase the dividend over time Common stock dividend will be reinstated at the end of Q3 2024 at an annualized level of $12m ($0.06/share) or $3.0m per quarter to start Target ongoing payout ratio of up to 25% of FCF Maintain Net Leverage Ratio(1) Target 2.0 – 3.0x long-term Net Leverage Ratio, with flexibility to temporarily stretch higher in order to pursue opportunistic scale M&A Leverage is 2.1x as of June 30, 2024, which is within the targeted range Opportunistic Share Buybacks Capitalize on stock price volatility by using excess liquidity to buy back stock when accretive to value Targeted opportunistic buybacks Priorities Objectives Actions Capital Allocation and Financial Policy Supplement Organic Growth with M&A Acquire leading B2B events or related assets in existing verticals and/or new, growing verticals to diversify exposure Capture revenue and/or cost synergies Multiple arbitrage Consider B2C events only in existing scale verticals Completed 9 acquisitions over the past 3.5 years


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Appendix


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Adjusted EBITDA UNAUDITED RECONCILIATION OF NET (LOSS) INCOME TO ADJUSTED EBITDA Other items for the three months ended June 30, 2024 included: (i) $0.9 million in acquisition-related transaction costs; (ii) $1.0 million in acquisition integration and restructuring-related transition costs, (iii) $0.7 million in non-recurring legal, audit and consulting fees and (iv) $2.2 million in gains related to the remeasurement of contingent consideration. Other items for the three months ended June 30, 2023 included: (i) $0.2 million in acquisition-related transaction costs, (ii) $0.8 million in transition expenses, (iii) $0.4 million in non-recurring legal, audit and consulting fees and (iv) $0.5 million in gains related to the remeasurement of contingent consideration. Other items for the six months ended June 30, 2024 included: (i) $1.2 million in acquisition-related transaction costs; (ii) $5.8 million in acquisition integration and restructuring-related transition costs, including one-time severance expense of $3.4 million; (iii) $1.0 million in non-recurring legal, audit and consulting fees and (iv) $0.7 million in gains related to the remeasurement of contingent consideration. Other items for the six months ended June 30, 2023 included (i) $0.9 million in acquisition-related transaction costs, (ii) $2.5 million in transition expenses, (iii) $2.2 million in non-recurring legal, audit and consulting fees and (iv) $0.5 million in gains related to the remeasurement of contingent consideration.     Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023       (dollars in millions) (unaudited)   Net (loss) income   $ (2.8 )   $ (8.1 )   $ 8.2     $ (1.0 ) Add (deduct):                         Interest expense, net     9.9       9.1       19.7       16.0   Loss on extinguishment of debt     —       2.3       —       2.3   (Benefit from) provision for income taxes     (0.7 )     (4.4 )     2.8       (1.7 ) Depreciation and amortization     7.0       12.9       14.1       26.4   Stock-based compensation     1.5       1.9       4.0       4.0   Other items(1)     0.4       0.9       7.3       5.1   Adjusted EBITDA   $ 15.3     $ 14.6     $ 56.1     $ 51.1   Deduct:                         Event cancellation insurance proceeds     —       —       1.0       —   Adjusted EBITDA excluding event cancellation insurance proceeds   $ 15.3     $ 14.6     $ 55.1     $ 51.1  


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Free Cash Flow UNAUDITED RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW     Three Months Ended June 30,     Six Months Ended June 30,       2024     2023     2024     2023       (dollars in millions) (unaudited)   Net Cash Provided by Operating Activities   $ 9.8     $ 7.3     $ 17.1     $ 16.2   Less:                         Capital expenditures     2.7       2.7       5.2       6.4   Free Cash Flow   $ 7.1     $ 4.6     $ 11.9     $ 9.8   Event cancellation insurance proceeds     —       —       (1.0 )     —   Free cash flow excluding event cancellation insurance proceeds, net   $ 7.1     $ 4.6     $ 10.9     $ 9.8  


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Income Statement – Consolidated Emerald UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME


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Income Statement – Connections Reportable Segment UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME – CONNECTIONS REPORTABLE SEGMENT


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Income Statement – All Other Category UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME – ALL OTHER CATEGORY


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Income Statement – Corporate-Level Activities UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME – CORPORATE-LEVEL ACTIVITIES