BASIS OF PRESENTATION
Except where the context requires otherwise, references in this prospectus to “Emerald Expositions”, “Emerald”, “the Company”, “we”, “us”, and “our” refer to Emerald Expositions Events, Inc., formerly known as Expo Event Holdco, Inc., together with its consolidated subsidiaries.
In this prospectus, when we refer to our fiscal years, we refer to the year number, as in “2016,” which refers to our fiscal year ended December 31, 2016.
When we refer to “NSF renewal rate”, we mean the NSF purchased by returning exhibitors as a percentage of the prior event’s total NSF. For the purpose of calculating NSF renewal rates, “win-backs” represent customers who did not exhibit in the immediately preceding event but who previously exhibited in the event within the past five years.
When we refer to “organic revenue growth,” this represents the growth in our overall revenue from one period to the next excluding the impact of acquisitions and excluding any change in revenues from now discontinued events.
Emerald Clinics gears up for an IPO
Unless indicated otherwise, the information included in this prospectus (1) assumes no exercise by the underwriters of the option to purchase up to an additional shares of common stock from the selling stockholders and (2) reflects the amendment of our certificate of incorporation on , 2017 to effect a -for-one stock split of our common stock and an increase in our authorized capital stock to shares of common stock.
Numerical figures included in this prospectus have been subject to rounding adjustments.
Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them.
In addition, we round certain percentages presented in this prospectus to the nearest whole number. As a result, figures expressed as percentages in the text may not total 100% or, as applicable, when aggregated may not be the arithmetic aggregation of the percentages that precede them.
USE OF NON-GAAP FINANCIAL MEASURES
This prospectus contains “non-GAAP financial measures”, which are financial measures that are not calculated and presented in accordance with generally accepted accounting principles in the United States, or “GAAP”.
The SEC has adopted rules to regulate the use in filings with the SEC and in other public disclosures of non-GAAP financial measures.
These rules govern the manner in which non-GAAP financial measures are publicly presented and require, among other things:
|•||a presentation with equal or greater prominence of the most comparable financial measure or measures calculated and presented in accordance with GAAP; and|
|•||a statement disclosing the purposes for which the registrant’s management uses the non-GAAP financial measure.|
Specifically, we make use of the non-GAAP financial measures “Adjusted EBITDA”, “Adjusted EBITDA margin”, “Acquisition Adjusted EBITDA”, “Adjusted Net Income” and “Free Cash Flow” in evaluating our past performance and future prospects.
For the definitions of Adjusted EBITDA and Acquisition Adjusted EBITDA and a reconciliation to net income, their most directly comparable financial measure presented in accordance with GAAP, see footnote 8 to the table under the heading “Summary—Summary Consolidated Financial Data.” Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue for the appropriate period. For the definition of Adjusted Net Income and a reconciliation to net income, its most directly comparable financial measure presented in accordance with GAAP, see footnote 9 to the table under the heading “Summary—Summary Consolidated Financial Data.” For the definition of Free Cash Flow and a reconciliation to net cash provided by operating activities, its most directly comparable financial measure presented in accordance with GAAP, see footnote 10 to the table under the heading “Summary—Summary Consolidated Financial Data.”
We present Adjusted EBITDA, Adjusted EBITDA margin, Acquisition Adjusted EBITDA and Adjusted Net Income because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
Management and our board of directors use Adjusted EBITDA, Adjusted EBITDA margin and Acquisition Adjusted EBITDA to assess our financial performance and believe they are helpful in highlighting trends because they exclude the results of decisions that are outside the control of management, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments.
Further, our executive incentive compensation is based in part on