##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2009
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission File Number: 001-11015
 VIAD CORP
 (Exact name of registrant as specified in its charter)
 Delaware
    
    36-1169950(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)incorporation or organization)1850 North Central Avenue, Suite 800Phoenix, Arizona
    
    85004-4545(Address of principal executive offices)
    
    (Zip Code)
 (602) 207-4000
 þ o
 o o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Small reporting company o(Do not check if a smaller reporting company)
 o þ




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TABLE OF CONTENTS  PART IFINANCIAL INFORMATIONItem 1. Financial StatementsItem 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsItem 3. Quantitative and Qualitative Disclosures About Market RiskItem 4. Controls and ProceduresPART IIOTHER INFORMATIONItem 1A. Risk FactorsItem 2. Unregistered Sales of Equity Securities and Use of ProceedsItem 6. ExhibitsSIGNATURESEX-31.1EX-31.2EX-32.1EX-32.2    Table of Contents  
 PART IFINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements.
 VIAD CORP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 September 30, 2009
    
    
    December 31, 2008(in thousands, except share data)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    128,543
    
    
    $
    148,040Accounts receivable, net of allowance for doubtful accounts
of $2,560 and $2,556, respectively
    
    
    54,731
    
    
    
    53,541Inventories
    
    
    44,113
    
    
    
    52,311Deferred income taxes
    
    
    16,809
    
    
    
    19,695Other current assets
    
    
    24,555
    
    
    
    14,453Total current assets
    
    
    268,751
    
    
    
    288,040Property and equipment, net
    
    
    173,495
    
    
    
    165,415Other investments and assets
    
    
    28,552
    
    
    
    26,560Deferred income taxes
    
    
    24,799
    
    
    
    18,996Goodwill
    
    
    123,767
    
    
    
    212,461Other intangible assets, net
    
    
    5,608
    
    
    
    17,932Total Assets
    
    $
    624,972
    
    
    $
    729,404LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    49,745
    
    
    $
    57,702Other current liabilities
    
    
    87,795
    
    
    
    109,059Current portion of long-term debt and capital lease obligations
    
    
    4,132
    
    
    
    2,556Total current liabilities
    
    
    141,672
    
    
    
    169,317Long-term debt and capital lease obligations
    
    
    9,504
    
    
    
    10,087Pension and postretirement benefits
    
    
    25,473
    
    
    
    25,121Other deferred items and liabilities
    
    
    48,750
    
    
    
    57,790Total liabilities
    
    
    225,399
    
    
    
    262,315Commitments and contingencies (Note 16)Stockholders equity:Viad Corp stockholders equity:Common stock, $1.50 par value, 200,000,000 shares
authorized, 24,934,981 shares issued
    
    
    37,402
    
    
    
    37,402Additional capital
    
    
    605,523
    
    
    
    623,781Retained earnings (deficit)
    
    
    (1,112
    )
    
    
    91,558Unearned employee benefits and other
    
    
    (6,918
    )
    
    
    (7,881
    )Accumulated other comprehensive income (loss):Unrealized gain (loss) on investments
    
    
    145
    
    
    
    (62
    )Cumulative foreign currency
translation adjustments
    
    
    28,228
    
    
    
    6,233Unrecognized net actuarial loss and
prior service credit
    
    
    (4,042
    )
    
    
    (3,673
    )Common stock in treasury, at cost, 4,380,438 and 4,655,956
shares, respectively
    
    
    (266,827
    )
    
    
    (286,803
    )Total Viad Corp stockholders equity
    
    
    392,399
    
    
    
    460,555Noncontrolling interest
    
    
    7,174
    
    
    
    6,534Total stockholders equity
    
    
    399,573
    
    
    
    467,089Total Liabilities and Stockholders Equity
    
    $
    624,972
    
    
    $
    729,404
  Page 2




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##### Table of Contents



VIAD CORP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 Three months ended September 30,
    
    
    Nine months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands, except per share data)Revenues:Convention and event services
    
    $
    104,895
    
    
    $
    205,057
    
    
    $
    456,512
    
    
    $
    661,629Exhibits and environments
    
    
    29,761
    
    
    
    46,791
    
    
    
    109,565
    
    
    
    173,196Travel and recreation services
    
    
    46,469
    
    
    
    50,514
    
    
    
    69,562
    
    
    
    80,194Total revenues
    
    
    181,125
    
    
    
    302,362
    
    
    
    635,639
    
    
    
    915,019Costs and expenses:Costs of services
    
    
    147,035
    
    
    
    227,136
    
    
    
    498,302
    
    
    
    663,228Costs of products sold
    
    
    36,780
    
    
    
    49,164
    
    
    
    123,552
    
    
    
    176,070Corporate activities
    
    
    2,024
    
    
    
    2,659
    
    
    
    4,230
    
    
    
    7,312Interest income
    
    
    (102
    )
    
    
    (809
    )
    
    
    (495
    )
    
    
    (2,562
    )Interest expense
    
    
    378
    
    
    
    430
    
    
    
    1,223
    
    
    
    1,308Restructuring charges (recoveries)
    
    
    3,867
    
    
    
    (124
    )
    
    
    6,797
    
    
    
    (124
    )Goodwill impairment losses
    
    
    98,304
    
    
    
    
    
    
    
    98,304
    
    
    
    Intangible asset impairment losses
    
    
    11,352
    
    
    
    
    
    
    
    11,352
    
    
    
    Other impairment losses
    
    
    1,700
    
    
    
    
    
    
    
    1,700
    
    
    
    Total costs and expenses
    
    
    301,338
    
    
    
    278,456
    
    
    
    744,965
    
    
    
    845,232Income (loss) from continuing operations before income taxes
    
    
    (120,213
    )
    
    
    23,906
    
    
    
    (109,326
    )
    
    
    69,787Income tax expense (benefit)
    
    
    (23,947
    )
    
    
    6,235
    
    
    
    (19,735
    )
    
    
    22,532Income (loss) from continuing operations
    
    
    (96,266
    )
    
    
    17,671
    
    
    
    (89,591
    )
    
    
    47,255Loss from discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (210
    )Net income (loss)
    
    
    (96,266
    )
    
    
    17,671
    
    
    
    (89,591
    )
    
    
    47,045Net income attributable to noncontrolling interest
    
    
    (867
    )
    
    
    (913
    )
    
    
    (640
    )
    
    
    (669
    )Net income (loss) attributable to Viad
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,376Diluted income (loss) per common shareIncome (loss) from continuing operations attributable to Viad
common stockholders
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.25Loss from discontinued operations attributable to Viad
common stockholders
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.01
    )Net income (loss) attributable to Viad common stockholders
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.24Weighted-average outstanding and potentially dilutive
common shares
    
    
    19,981
    
    
    
    20,650
    
    
    
    19,950
    
    
    
    20,662Basic income (loss) per common shareIncome (loss) from continuing operations attributable to Viad
common stockholders
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.25Loss from discontinued operations attributable to Viad
common stockholders
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.01
    )Net income (loss) attributable to Viad common stockholders
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.24Weighted-average outstanding common shares
    
    
    19,981
    
    
    
    20,294
    
    
    
    19,950
    
    
    
    20,253Dividends declared per common share
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.12
    
    
    $
    0.12Amounts attributable to Viad common stockholdersIncome (loss) from continuing operations
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,586Loss from discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (210
    )Net income (loss)
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,376
  Page 3




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VIAD CORP
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
 Three months ended September 30,
    
    
    Nine months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Net income (loss)
    
    $
    (96,266
    )
    
    $
    17,671
    
    
    $
    (89,591
    )
    
    $
    47,045Other comprehensive income (loss):Unrealized gains (losses) on investments:Holding gains (losses) arising during the
period, net of tax
    
    
    146
    
    
    
    (153
    )
    
    
    207
    
    
    
    (297
    )Unrealized foreign currency translation adjustments
    
    
    11,571
    
    
    
    (11,639
    )
    
    
    21,995
    
    
    
    (14,581
    )Pension and postretirement benefit plans:Amortization of net actuarial loss, net of tax
    
    
    106
    
    
    
    21
    
    
    
    201
    
    
    
    164Amortization of prior service credit, net of tax
    
    
    (190
    )
    
    
    (270
    )
    
    
    (570
    )
    
    
    (681
    )Total other comprehensive income (loss)
    
    
    11,633
    
    
    
    (12,041
    )
    
    
    21,833
    
    
    
    (15,395
    )Comprehensive income (loss)
    
    
    (84,633
    )
    
    
    5,630
    
    
    
    (67,758
    )
    
    
    31,650Comprehensive income attributable to noncontrolling interest
    
    
    (867
    )
    
    
    (913
    )
    
    
    (640
    )
    
    
    (669
    )Comprehensive income (loss) attributable to Viad
    
    $
    (85,500
    )
    
    $
    4,717
    
    
    $
    (68,398
    )
    
    $
    30,981
  Page 4




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VIAD CORP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 Nine months ended September 30,2009
    
    
    2008(in thousands)Cash flows from operating activities:Net income (loss)
    
    $
    (89,591
    )
    
    $
    47,045Adjustments to reconcile net income (loss) to net cash provided by
operating activities:Depreciation and amortization
    
    
    21,380
    
    
    
    21,388Deferred income taxes
    
    
    (6,353
    )
    
    
    7,562Loss from discontinued operations
    
    
    
    
    
    
    210Restructuring charges (recoveries)
    
    
    6,797
    
    
    
    (124
    )Impairment charges
    
    
    111,356
    
    
    
    Gains on dispositions of property and other assets
    
    
    (22
    )
    
    
    (88
    )Share-based compensation expense
    
    
    2,239
    
    
    
    6,654Tax benefit from share-based compensation arrangements
    
    
    
    
    
    
    562Excess tax benefit from share-based compensation arrangements
    
    
    
    
    
    
    (361
    )Other non-cash items, net
    
    
    4,023
    
    
    
    3,449Change in operating assets and liabilities:Receivables
    
    
    (2,706
    )
    
    
    (24,781
    )Inventories
    
    
    8,198
    
    
    
    1,819Accounts payable
    
    
    (6,123
    )
    
    
    11,506Restructuring liabilities
    
    
    (5,537
    )
    
    
    (1,646
    )Accrued compensation
    
    
    (16,086
    )
    
    
    (4,753
    )Customer deposits
    
    
    (4,297
    )
    
    
    (4,453
    )Income taxes payable
    
    
    (10,281
    )
    
    
    2,512Other assets and liabilities, net
    
    
    (11,354
    )
    
    
    (14,236
    )Net cash provided by operating activities
    
    
    1,643
    
    
    
    52,265Cash flows from investing activities:Capital expenditures
    
    
    (18,727
    )
    
    
    (32,049
    )Acquisition of business, net of cash acquired
    
    
    
    
    
    
    (23,334
    )Proceeds from sale of short-term investments
    
    
    
    
    
    
    3,980Proceeds from dispositions of property and other assets
    
    
    43
    
    
    
    532Net cash used in investing activities
    
    
    (18,684
    )
    
    
    (50,871
    )Cash flows from financing activities:Payments on debt and capital lease obligations
    
    
    (2,493
    )
    
    
    (2,108
    )Dividends paid on common stock
    
    
    (2,470
    )
    
    
    (2,491
    )Common stock purchased for treasury
    
    
    (1,167
    )
    
    
    (11,695
    )Excess tax benefit from share-based compensation arrangements
    
    
    
    
    
    
    361Proceeds from exercise of stock options
    
    
    
    
    
    
    3,700Net cash used in financing activities
    
    
    (6,130
    )
    
    
    (12,233
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    3,674
    
    
    
    (1,347
    )Net decrease in cash and cash equivalents
    
    
    (19,497
    )
    
    
    (12,186
    )Cash and cash equivalents, beginning of year
    
    
    148,040
    
    
    
    165,069Cash and cash equivalents, end of period
    
    $
    128,543
    
    
    $
    152,883Supplemental disclosure of cash flow informationCash paid during the period for:Income taxes
    
    $
    8,642
    
    
    $
    15,692Interest
    
    $
    673
    
    
    $
    903Equipment acquired under capital leases
    
    $
    3,253
    
    
    $
    633
  Page 5




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VIAD CORP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 1. Basis of Preparation and Principles of Consolidation
    Note 2. Share-Based Compensation
    Page 6




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##### Table of Contents



Restricted Stock
    
    PBRSWeighted-Average
    
    
    
    
    
    Weighted-AverageGrant Date
    
    
    
    
    
    Grant DateShares
    
    Fair Value
    
    Shares
    
    Fair ValueBalance at January 1, 2009
    
    
    358,285
    
    
    $
    34.25
    
    
    
    94,828
    
    
    $
    34.56Granted
    
    
    228,633
    
    
    
    15.44
    
    
    
    162,600
    
    
    
    15.36Vested
    
    
    (176,962
    )
    
    
    31.05
    
    
    
    (46,701
    )
    
    
    34.21Forfeited
    
    
    (12,346
    )
    
    
    27.81
    
    
    
    (35,800
    )
    
    
    15.87Balance at September 30, 2009
    
    
    397,610
    
    
    
    25.05
    
    
    
    174,927
    
    
    
    20.63
    Weighted-Average
    
    OptionsShares
    
    Exercise Price
    
    ExercisableOptions outstanding at January 1, 2009
    
    
    606,660
    
    
    $
    25.86
    
    
    
    459,612Forfeited
    
    
    (48,811
    )
    
    
    27.72Options outstanding at September 30, 2009
    
    
    557,849
    
    
    
    25.70
    
    
    
    476,089
 Page 7




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##### Table of Contents



Options Outstanding
    
    Options ExercisableWeighted-Average
    
    Weighted-
    
    
    
    
    
    Weighted-Remaining
    
    Average
    
    
    
    
    
    AverageRange of Exercise Prices
    
    Shares
    
    Contractual Life
    
    Exercise Price
    
    Shares
    
    Exercise Price$18.40 to $20.77
    
    
    74,795
    
    
    3.1 years
    
    $
    19.58
    
    
    
    74,795
    
    
    $
    19.58$22.29 to $24.05
    
    
    100,677
    
    
    1.2 years
    
    
    23.88
    
    
    
    100,677
    
    
    
    23.88$24.22 to $26.07
    
    
    161,582
    
    
    2.2 years
    
    
    25.13
    
    
    
    151,582
    
    
    
    25.14$26.31 to $26.49
    
    
    147,970
    
    
    2.3 years
    
    
    26.34
    
    
    
    120,260
    
    
    
    26.35$30.82 to $38.44
    
    
    72,825
    
    
    4.4 years
    
    
    34.48
    
    
    
    28,775
    
    
    
    34.13$18.40 to $38.44
    
    
    557,849
    
    
    2.5 years
    
    
    25.70
    
    
    
    476,089
    
    
    
    24.85
   Note 3. Impairment Losses
    Page 8




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Note 4. Acquisition of Business
  Note 5. Inventories
  September 30,
    
    
    December 31,2009
    
    
    2008(in thousands)Raw materials
    
    $
    24,126
    
    
    $
    30,683Work in process
    
    
    19,987
    
    
    
    21,628Inventories
    
    $
    44,113
    
    
    $
    52,311
  Note 6. Property and Equipment
  September 30,
    
    
    December 31,2009
    
    
    2008(in thousands)Land
    
    $
    25,976
    
    
    $
    23,623Buildings and leasehold improvements
    
    
    94,154
    
    
    
    88,999Equipment and other
    
    
    287,975
    
    
    
    267,175408,105
    
    
    
    379,797Accumulated depreciation
    
    
    (234,610
    )
    
    
    (214,382
    )Property and equipment, net
    
    $
    173,495
    
    
    $
    165,415
   Page 9




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Note 7. Goodwill and Other Intangible Assets
   Experiential
    
    
    Travel andGES
    
    
    Marketing
    
    
    Recreation
    
    
    Total(in thousands)Balance at January 1, 2009
    
    $
    174,018
    
    
    $
    5,063
    
    
    $
    33,380
    
    
    $
    212,461Goodwill impairment losses
    
    
    (93,241
    )
    
    
    (5,063
    )
    
    
    
    
    
    
    (98,304
    )Foreign currency translation
adjustments
    
    
    4,067
    
    
    
    
    
    
    
    5,543
    
    
    
    9,610Balance at September 30, 2009
    
    $
    84,844
    
    
    $
    
    
    
    $
    38,923
    
    
    $
    123,767
  Gross Carrying
    
    
    Accumulated
    
    
    Net CarryingValue
    
    
    Amortization
    
    
    Value(in thousands)Amortized intangible assets:Customer contracts and relationships
    
    $
    2,494
    
    
    $
    (343
    )
    
    $
    2,151Proprietary technology
    
    
    523
    
    
    
    (298
    )
    
    
    225Design libraries
    
    
    175
    
    
    
    
    
    
    
    175Non-compete agreements
    
    
    1,922
    
    
    
    (1,809
    )
    
    
    113Other
    
    
    495
    
    
    
    (57
    )
    
    
    4385,609
    
    
    
    (2,507
    )
    
    
    3,102Unamortized intangible assets:Trademarks and trade names
    
    
    2,476
    
    
    
    
    
    
    
    2,476Other
    
    
    30
    
    
    
    
    
    
    
    302,506
    
    
    
    
    
    
    
    2,506Total
    
    $
    8,115
    
    
    $
    (2,507
    )
    
    $
    5,608
  Gross Carrying
    
    
    Accumulated
    
    
    Net CarryingValue
    
    
    Amortization
    
    
    Value(in thousands)Amortized intangible assets:Customer contracts and relationships
    
    $
    8,634
    
    
    $
    (901
    )
    
    $
    7,733Design libraries
    
    
    2,020
    
    
    
    (226
    )
    
    
    1,794Non-compete agreements
    
    
    1,933
    
    
    
    (1,634
    )
    
    
    299Proprietary technology
    
    
    735
    
    
    
    (293
    )
    
    
    442Other
    
    
    79
    
    
    
    (35
    )
    
    
    4413,401
    
    
    
    (3,089
    )
    
    
    10,312Unamortized intangible assets:Trademarks and trade names
    
    
    7,590
    
    
    
    
    
    
    
    7,590Other
    
    
    30
    
    
    
    
    
    
    
    307,620
    
    
    
    
    
    
    
    7,620Total
    
    $
    21,021
    
    
    $
    (3,089
    )
    
    $
    17,932
 Page 10




---



##### Table of Contents



(in thousands)2009
    
    $
    2932010
    
    $
    1,1322011
    
    $
    8442012
    
    $
    3492013 and thereafter
    
    $
    484
 Note 8. Accrued Liabilities and Other
  September 30,
    
    
    December 31,2009
    
    
    2008(in thousands)Continuing operations:Customer deposits
    
    $
    38,714
    
    
    $
    43,011Accrued compensation
    
    
    13,270
    
    
    
    29,048Self-insured liability accrual
    
    
    9,072
    
    
    
    8,258Accrued restructuring
    
    
    4,085
    
    
    
    2,337Accrued sales and use taxes
    
    
    2,155
    
    
    
    3,473Accrued dividends
    
    
    849
    
    
    
    840Accrued income taxes
    
    
    250
    
    
    
    5,199Other
    
    
    16,454
    
    
    
    13,42784,849
    
    
    
    105,593Discontinued operations:Environmental remediation
liabilities
    
    
    1,750
    
    
    
    2,208Self-insured liability accrual
    
    
    712
    
    
    
    461Other
    
    
    484
    
    
    
    7972,946
    
    
    
    3,466Total other current liabilities
    
    $
    87,795
    
    
    $
    109,059
 Page 11




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##### Table of Contents



September 30,
    
    
    December 31,2009
    
    
    2008(in thousands)Continuing operations:Self-insured liability accrual
    
    $
    13,224
    
    
    $
    14,387Accrued compensation
    
    
    4,886
    
    
    
    5,194Foreign deferred tax liability
    
    
    3,704
    
    
    
    3,340Accrued restructuring
    
    
    2,835
    
    
    
    4,207Deferred gain on sale of property
    
    
    887
    
    
    
    1,612Accrued income taxes
    
    
    511
    
    
    
    5,462Other
    
    
    5,493
    
    
    
    5,29631,540
    
    
    
    39,498Discontinued operations:Self-insured liability accrual
    
    
    8,889
    
    
    
    9,435Environmental remediation liabilities
    
    
    5,074
    
    
    
    5,516Accrued income taxes
    
    
    939
    
    
    
    909Other
    
    
    2,308
    
    
    
    2,43217,210
    
    
    
    18,292Total other deferred items and
liabilities
    
    $
    48,750
    
    
    $
    57,790
 Note 9. Debt
    Page 12




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Note 10. Stockholders Equity
  Total Viad
    
    
    
    
    
    
    TotalStockholders
    
    
    Noncontrolling
    
    
    StockholdersEquity
    
    
    Interest
    
    
    Equity(in thousands)Balance at January 1, 2009
    
    $
    460,555
    
    
    $
    6,534
    
    
    $
    467,089Net income (loss)
    
    
    (90,231
    )
    
    
    640
    
    
    
    (89,591
    )Dividends on common stock
    
    
    (2,470
    )
    
    
    
    
    
    
    (2,470
    )Common stock purchased for treasury
    
    
    (1,167
    )
    
    
    
    
    
    
    (1,167
    )Employee benefit plans
    
    
    2,837
    
    
    
    
    
    
    
    2,837Unrealized foreign currency translation adjustment
    
    
    21,995
    
    
    
    
    
    
    
    21,995Unrealized gain on investments
    
    
    207
    
    
    
    
    
    
    
    207Amortization of prior service cost and net actuarial loss
    
    
    (369
    )
    
    
    
    
    
    
    (369
    )ESOP allocation adjustment
    
    
    1,000
    
    
    
    
    
    
    
    1,000Other
    
    
    42
    
    
    
    
    
    
    
    42Balance at September 30, 2009
    
    $
    392,399
    
    
    $
    7,174
    
    
    $
    399,573
  Total Viad
    
    
    
    
    
    
    TotalStockholders
    
    
    Noncontrolling
    
    
    StockholdersEquity
    
    
    Interest
    
    
    Equity(in thousands)Balance at January 1, 2008
    
    $
    469,845
    
    
    $
    5,984
    
    
    $
    475,829Net income
    
    
    46,376
    
    
    
    669
    
    
    
    47,045Dividends on common stock
    
    
    (2,491
    )
    
    
    
    
    
    
    (2,491
    )Common stock purchased for treasury
    
    
    (11,695
    )
    
    
    
    
    
    
    (11,695
    )Employee benefit plans
    
    
    8,798
    
    
    
    
    
    
    
    8,798Unrealized foreign currency translation adjustment
    
    
    (14,581
    )
    
    
    
    
    
    
    (14,581
    )Unrealized loss on investments
    
    
    (297
    )
    
    
    
    
    
    
    (297
    )Amortization of prior service cost and net
actuarial loss
    
    
    (517
    )
    
    
    
    
    
    
    (517
    )ESOP allocation adjustment
    
    
    750
    
    
    
    
    
    
    
    750Other
    
    
    37
    
    
    
    
    
    
    
    37Balance at September 30, 2008
    
    $
    496,225
    
    
    $
    6,653
    
    
    $
    502,878
 Note 11. Fair Value Measurements
   Level 2 
    Observable inputs other than quoted prices included within Level 1 that are observable
for the asset or liability, either directly or indirectly.
  Page 13




---



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Fair Value Measurements at September 30, 2009 UsingQuoted Prices
    
    
    Significantin Active
    
    
    Other
    
    
    SignificantMarkets for
    
    
    Observable
    
    
    UnobservedSeptember 30,
    
    
    Identical Assets
    
    
    Inputs
    
    
    Inputs2009
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)(in thousands)Assets:Money market funds
    
    $
    38,381
    
    
    $
    38,381
    
    
    $
    
    
    
    $
    Other mutual funds
    
    
    1,870
    
    
    
    1,870
    
    
    
    
    
    
    
    Total
    
    $
    40,251
    
    
    $
    40,251
    
    
    $
    
    
    
    $
    
    Page 14




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Note 12. Income Per Share
  Three months ended September 30,
    
    
    Nine months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands, except per share data)Basic net income (loss) per shareNumerator:Net income (loss) attributable to Viad
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,376Less: Allocation to nonvested shares
    
    
    
    
    
    
    (367
    )
    
    
    
    
    
    
    (1,014
    )Net income (loss) allocated to Viad common stockholders
    
    $
    (97,133
    )
    
    $
    16,391
    
    
    $
    (90,231
    )
    
    $
    45,362Denominator:Weighted-average outstanding common shares
    
    
    19,981
    
    
    
    20,294
    
    
    
    19,950
    
    
    
    20,253Net income (loss) attributable to Viad common stockholders
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.24Diluted net income (loss) per shareNumerator:Net income (loss) attributable to Viad
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,376Denominator:Weighted-average outstanding shares
    
    
    19,981
    
    
    
    20,294
    
    
    
    19,950
    
    
    
    20,253Additional dilutive shares related to share-based
compensation
    
    
    
    
    
    
    356
    
    
    
    
    
    
    
    409Weighted-average outstanding and potentially dilutive
shares
    
    
    19,981
    
    
    
    20,650
    
    
    
    19,950
    
    
    
    20,662Net income (loss) attributable to Viad common
stockholders(1)
    
    $
    (4.86
    )
    
    $
    0.81
    
    
    $
    (4.52
    )
    
    $
    2.24
 
 (1)
    
    Diluted income per share amount cannot exceed basic income per share.  Note 13. Income Taxes
  2009
    
    2008(in thousands)Computed income tax expense (benefit) at
statutory federal income
tax rate of 35%
    
    $
    (38,264
    )
    
    
    35.0
    %
    
    $
    24,425
    
    
    
    35.0
    %State income tax expense (benefit), net of
federal benefit or provision
    
    
    (5,473
    )
    
    
    5.0
    %
    
    
    2,044
    
    
    
    2.9
    %Tax resolutions, net
    
    
    (3,297
    )
    
    
    3.1
    %
    
    
    (3,177
    )
    
    
    (4.5
    %)Nondeductible goodwill impairment
    
    
    26,831
    
    
    
    (24.5
    %)
    
    
    
    
    
    
    0.0
    %Other, net
    
    
    468
    
    
    
    (0.4
    %)
    
    
    (760
    )
    
    
    (1.1
    %)Income tax expense (benefit)
    
    $
    (19,735
    )
    
    
    18.1
    %
    
    $
    22,532
    
    
    
    32.3
    %
  Page 15




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Continuing
    
    
    DiscontinuedOperations
    
    
    Operations
    
    
    Total(in thousands)Balance at January 1, 2009
    
    $
    3,487
    
    
    $
    636
    
    
    $
    4,123Reductions for tax positions taken in
prior years
    
    
    (2,702
    )
    
    
    
    
    
    
    (2,702
    )Reductions for tax settlements
    
    
    (174
    )
    
    
    
    
    
    
    (174
    )Reductions for lapse of applicable statutes
    
    
    (365
    )
    
    
    
    
    
    
    (365
    )Balance at September 30, 2009
    
    $
    246
    
    
    $
    636
    
    
    $
    882
    Page 16




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Note 14. Pension and Postretirement Benefits
  Domestic PlansPostretirement
    
    
    ForeignPension Plans
    
    
    Benefit Plans
    
    
    Pension Plans2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Service cost
    
    $
    50
    
    
    $
    55
    
    
    $
    19
    
    
    $
    16
    
    
    $
    65
    
    
    $
    93Interest cost
    
    
    327
    
    
    
    353
    
    
    
    301
    
    
    
    269
    
    
    
    198
    
    
    
    166Expected return on plan assets
    
    
    (149
    )
    
    
    (245
    )
    
    
    (50
    )
    
    
    (99
    )
    
    
    (136
    )
    
    
    (180
    )Amortization of prior service
cost (credit)
    
    
    11
    
    
    
    21
    
    
    
    (323
    )
    
    
    (461
    )
    
    
    
    
    
    
    Recognized net actuarial loss
    
    
    96
    
    
    
    110
    
    
    
    120
    
    
    
    4
    
    
    
    
    
    
    
    Net periodic benefit cost (credit)
    
    $
    335
    
    
    $
    294
    
    
    $
    67
    
    
    $
    (271
    )
    
    $
    127
    
    
    $
    79
  Domestic PlansPostretirement
    
    
    ForeignPension Plans
    
    
    Benefit Plans
    
    
    Pension Plans2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Service cost
    
    $
    138
    
    
    $
    155
    
    
    $
    51
    
    
    $
    48
    
    
    $
    123
    
    
    $
    285Interest cost
    
    
    975
    
    
    
    963
    
    
    
    843
    
    
    
    769
    
    
    
    392
    
    
    
    511Expected return on plan assets
    
    
    (471
    )
    
    
    (633
    )
    
    
    (154
    )
    
    
    (263
    )
    
    
    (258
    )
    
    
    (553
    )Amortization of prior service
cost (credit)
    
    
    33
    
    
    
    57
    
    
    
    (969
    )
    
    
    (1,171
    )
    
    
    
    
    
    
    Recognized net actuarial loss
    
    
    276
    
    
    
    292
    
    
    
    270
    
    
    
    142
    
    
    
    
    
    
    
    Net periodic benefit cost (credit)
    
    $
    951
    
    
    $
    834
    
    
    $
    41
    
    
    $
    (475
    )
    
    $
    257
    
    
    $
    243
  Page 17




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Note 15. Restructuring Charges and Recoveries
  2009
    
    
    OtherRestructurings
    
    
    Restructurings
    
    
    Total(in thousands)Balance at January 1, 2009
    
    $
    
    
    
    $
    6,544
    
    
    $
    6,544Restructuring charges (recoveries)
    
    
    7,962
    
    
    
    (1,165
    )
    
    
    6,797Cash payments
    
    
    (3,844
    )
    
    
    (1,693
    )
    
    
    (5,537
    )Adjustment to liability
    
    
    (651
    )
    
    
    (233
    )
    
    
    (884
    )Balance at September 30, 2009
    
    $
    3,467
    
    
    $
    3,453
    
    
    $
    6,920
 Note 16. Litigation, Claims and Other Contingencies
     Page 18




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Note 17. Segment Information
  Three months ended September 30,
    
    
    Nine months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Revenues:Marketing & Events Group:GES
    
    $
    106,612
    
    
    $
    203,278
    
    
    $
    444,672
    
    
    $
    676,598Experiential Marketing Services
    
    
    28,044
    
    
    
    48,570
    
    
    
    121,405
    
    
    
    158,227Travel & Recreation Group
    
    
    46,469
    
    
    
    50,514
    
    
    
    69,562
    
    
    
    80,194$
    181,125
    
    
    $
    302,362
    
    
    $
    635,639
    
    
    $
    915,019Segment operating income (loss):Marketing & Events Group:GES
    
    $
    (14,382
    )
    
    $
    7,941
    
    
    $
    6,828
    
    
    $
    57,745Experiential Marketing Services
    
    
    (7,856
    )
    
    
    (3,594
    )
    
    
    (12,480
    )
    
    
    (5,770
    )Travel & Recreation Group
    
    
    19,548
    
    
    
    21,715
    
    
    
    19,437
    
    
    
    23,746(2,690
    )
    
    
    26,062
    
    
    
    13,785
    
    
    
    75,721Corporate activities
    
    
    (2,024
    )
    
    
    (2,659
    )
    
    
    (4,230
    )
    
    
    (7,312
    )(4,714
    )
    
    
    23,403
    
    
    
    9,555
    
    
    
    68,409Interest income
    
    
    102
    
    
    
    809
    
    
    
    495
    
    
    
    2,562Interest expense
    
    
    (378
    )
    
    
    (430
    )
    
    
    (1,223
    )
    
    
    (1,308
    )Restructuring recoveries (charges):GES
    
    
    (3,151
    )
    
    
    82
    
    
    
    (3,437
    )
    
    
    82Experiential Marketing Services
    
    
    58
    
    
    
    
    
    
    
    (2,586
    )
    
    
    Corporate
    
    
    (774
    )
    
    
    42
    
    
    
    (774
    )
    
    
    42Impairment losses:GES
    
    
    (95,718
    )
    
    
    
    
    
    
    (95,718
    )
    
    
    Experiential Marketing Services
    
    
    (15,638
    )
    
    
    
    
    
    
    (15,638
    )
    
    
    Income (loss) from continuing operations
before income taxes
    
    $
    (120,213
    )
    
    $
    23,906
    
    
    $
    (109,326
    )
    
    $
    69,787
 September 30,
    
    
    December 31,2009
    
    
    2008(in thousands)Assets:Marketing & Events GroupGES
    
    $
    263,824
    
    
    $
    340,849Experiential Marketing Services
    
    
    84,886
    
    
    
    102,361Travel & Recreation Group
    
    
    149,473
    
    
    
    120,198Corporate and other
    
    
    126,789
    
    
    
    165,996$
    624,972
    
    
    $
    729,404
 Page 19




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Note 18. Impact of Recent Accounting Pronouncements
      Page 20




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Page 21




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Note 19. Common Stock Repurchases
  Note 20. Subsequent Event
  Page 22




---



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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  Overview:
   Marketing & Events Group:
 GES
 Experiential Marketing Services
 Travel & Recreation Group
  Viad Corp (Consolidated)
 
    
    Total revenues of $181.1 million compared to $302.4 million in the third
quarter of 2008
    
    Net loss attributable to Viad of $97.1 million versus income of $16.8
million in the third quarter of 2008
    
    Diluted loss per share of $4.86 versus income per share of $0.81 in the
third quarter of 2008
    
    Restructuring charges of $5.2 million primarily related to facility
consolidations and other reorganization activities, and reversal of restructuring
reserves of $1.3 million
    
    Impairment losses of $111.4 million pre-tax primarily related to the
non-cash write-down of goodwill and other intangible assets at GES and Becker Group
    
    Cash and cash equivalents totaled $128.5 million as of September 30, 2009
    
    Debt was $13.6 million as of September 30, 2009
 Page 23




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Marketing & Events Group
 GES:
 
    
    Revenues of $106.6 million, a decrease of 47.6 percent from the third
quarter of 2008
    
    Segment operating loss of $14.4 million, as compared to income of $7.9
million in the third quarter of 2008
 Experiential Marketing Services:
 
    
    Revenues of $28.0 million, a decrease of 42.3 percent from the third
quarter of 2008
    
    Segment operating loss of $7.9 million, as compared to a loss of $3.6
million in the third quarter of 2008
 Travel & Recreation Group
 
    
    Revenues of $46.5 million, a decrease of 8.0 percent from the third
quarter of 2008
    
    Segment operating income of $19.5 million, a decrease of 10.0 percent from
the third quarter of 2008
 Non-GAAP Measures:
   Page 24




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Three months ended September 30,
    
    
    Nine months ended September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Adjusted EBITDA
    
    $
    (1,501
    )
    
    $
    30,967
    
    
    $
    23,993
    
    
    $
    91,814Impairment losses
    
    
    (111,356
    )
    
    
    
    
    
    
    (111,356
    )
    
    
    Interest expense
    
    
    (378
    )
    
    
    (430
    )
    
    
    (1,223
    )
    
    
    (1,308
    )Income tax benefit (expense)
    
    
    23,947
    
    
    
    (6,235
    )
    
    
    19,735
    
    
    
    (22,532
    )Depreciation and amortization
    
    
    (7,845
    )
    
    
    (7,544
    )
    
    
    (21,380
    )
    
    
    (21,388
    )Loss from discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (210
    )Net income (loss) attributable to Viad
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,376
   Three months ended
    
    
    Nine months endedSeptember 30,
    
    
    September 30,2009
    
    
    2008
    
    
    2009
    
    
    2008(in thousands)Income (loss) before
impairment losses
attributable to Viad
    
    $
    (2,955
    )
    
    $
    16,758
    
    
    $
    3,947
    
    
    $
    46,586Impairment losses, net of tax
    
    
    (94,178
    )
    
    
    
    
    
    
    (94,178
    )
    
    
    Income (loss) from
continuing operations
attributable to Viad
    
    $
    (97,133
    )
    
    $
    16,758
    
    
    $
    (90,231
    )
    
    $
    46,586
  Results of Operations:
 Comparison of Third Quarter of 2009 to the Third Quarter of 2008
  Marketing & Events Group.
  Page 25




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Travel & Recreation Group.
 Page 26




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Corporate Activities.
 Interest Income.
 Restructuring Charges.
 Income Taxes.
 Comparison of First Nine Months of 2009 to the First Nine Months of 2008
  Page 27




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Marketing & Events Group.
   Travel & Recreation Group.
  Corporate Activities.
 Interest Income.
 Restructuring Charges.
 Income Taxes.
 Page 28




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Liquidity and Capital Resources:
         Page 29




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Off-Balance Sheet Arrangements:
  Critical Accounting Policies and Estimates:
  Goodwill and other intangible assets 
 Page 30




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Page 31




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Income taxes
      Page 32




---



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Insurance liabilities
 Pension and postretirement benefits
      Share-based compensation
 Page 33




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Impact of Recent Accounting Pronouncements:
    Page 34




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Page 35




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Forward-Looking Statements:
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  Page 36




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Item 4. Controls and Procedures.
  Page 37




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Page 38




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PART IIOTHER INFORMATION
 
 Item 1A. Risk Factors.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  ISSUER PURCHASES OF EQUITY SECURITIES
 Total Number of
    
    
    Maximum Number (orShares Purchased as
    
    
    Approximate Dollar  Value)Total Number of
    
    
    Average Price Paid
    
    
    Part of Publicly
    
    
    of Shares that May Yet BeShares Purchased
    
    
    Per Share
    
    
    Announced Plans or
    
    
    Purchased  Under the PlansPeriod
    
    (#)
    
    
    ($)
    
    
    Programs
    
    
    or   Programs (1)July 2009
    
    
    273
    
    
    
    17.41
    
    
    
    
    
    
    
    160,681Total
    
    
    273
    
    
    
    17.41
    
    
    
    
    
    
    
    160,681
 
 (1)
    
    Viad has announced its intent, under authorizations by its Board of
Directors, to repurchase up to an aggregate of three million shares of the Companys
common stock from time to time at prevailing prices in the open market. No shares were
purchased during the third quarter of 2009. Shares repurchased to date under these
programs totaled 2,839,319. The authorizations of the Board of Directors do not have
expiration dates. Page 39




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Item 6. Exhibits.
 Exhibit No. 31.1
    
    Certification of Chief Executive Officer of Viad Corp
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002*Exhibit No. 31.2
    
    Certification of Chief Financial Officer of Viad Corp
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002*Exhibit No. 32.1
    
    Certification of Chief Executive Officer of Viad Corp
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002*Exhibit No. 32.2
    
    Certification of Chief Financial Officer of Viad Corp
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002*
 
 *
    
    Filed herewith. Page 40




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SIGNATURES
  VIAD CORP
(Registrant)November 6, 2009
(Date)
    
    By /s/ G. Michael LattaG. Michael LattaVice President  Controller(Chief Accounting Officerand Authorized Officer)
 Page 41