Vail Resorts posts gains in latest earnings report, increases dividend |

Vail Resorts posts gains in latest earnings report, increases dividend

Company's newest resort acquisitions drive increases in skier visits

Despite slower-than-expected early-season visits, Vail Resorts has posted revenue gains in several areas of its operations.
By the numbers $209: Price of a one-day, walk-up lift ticket for Vail. $106: Starting price of the Epic Day Pass. 15.1 percent: Increase in Vail Resorts ski school revenue, compared with the prior period in the 2018 fiscal year. $216.46: Closing price Friday of Vail Resorts stock, a 6.95 percent increase.

Despite a somewhat slow start to the current ski season, Vail Resorts has reported gains over the previous year in its latest earnings report. Still, the company is adjusting down its earnings forecast for this fiscal year.

Speaking on a conference call with a number of industry analysts Friday, Vail Resorts President and CEO Rob Katz and company chief financial officer Michael Barkin provided details of the previous quarter, which runs from November through the end of January.

Katz noted that the company business had experienced some setbacks, primarily in lower-than-expected visitation in the weeks before the Christmas holiday season, some weather-related closures in California resorts near Lake Tahoe and declines in international visitors to Whistler Blackcomb in British Columbia.

With those setbacks, the company reported:

  • A 17.2 percent increase in total lift revenue and a 27 percent increase in skier visitation from the second quarter of the previous fiscal year. Those results included the fresh acquisitions of Crested Butte Mountain Resort, Okemo Mountain Resort in Vermont, Mount Sunapee Resort in New Hampshire and Stevens Pass in Washington.
  • Effective ticket prices declined 7.8 percent from the previous year. The company attributed the decline to higher visitation by season pass holders and the addition of the lower-priced Epic Military Pass. That pass is available to active duty military members at $129.
  • The company has sold nearly 100,000 of the military passes.
  • Lodging revenue increased by 16.1 percent, primarily due to the additions of Crested Butte, Okemo and Mount Sunapee. The average daily rate at lodging properties decreases, primarily due to the addition of those resorts.
  • The company announced a 20 percent increase in the quarterly dividend that will be paid to shareholders in April. The increase brings the dividend to $1.76 per share.

Latest salvo in pass wars

Katz and Barkin fielded several questions from analysts about pass sales, and particularly this week’s announcement of the new Epic Day Pass. That pass allows buyers to pay discounted prices in advance for between one and seven days at the company’s North American resorts.

Katz acknowledged that the Epic Day Pass may affect lift revenue in the short-term. While the company has pushed pass sales for years, passes of all kinds accounted for 47 percent of the company’s 2018 list revenue.

But, Katz added, the company believes the Epic Day Pass can create long-term customers from people who don’t ski as often as other pass holders.

The “lifetime value of guests” is worth the short-term revenue trade-off he said.

Asked if the Epic Day Pass is an experiment or a long-term initiative, Katz said the new pass is here to stay.

“This is a logical extension of what we’ve already done,” Katz said, adding that it can take a “number of years” for customers to become comfortable buying passes instead of walk-up lift tickets.

Katz also discussed Alterra Mountain Co.’s Ikon Pass.

“It’s hard to know” whether Ikon has had an effect on Vail Resorts’ pass sales, he said. But, Katz added, in many cases the Ikon Pass replaced other pass products that Vail Resorts has been competing with in the past.

While calling Ikon a “great product,” Katz said he doesn’t believe the pass has caused a “structural change” to what drives Vail Resorts’ pass sales.

No A-Basin, no problem

Katz was asked about Arapahoe Basin dropping out of the Epic Pass network. He replied that “it’s hard to say” how that might impact pass sales in the coming season.

“We feel we have a terrific selection of resorts,” Katz said. In Summit County, Keystone generally opens early, and Breckenridge will stay open until Memorial Day this year.

“We feel like we’re giving guests the benefits A-Basin offered,” he said, adding that with the addition of a new Keystone Plus pass, “we have a pretty compelling product without (A-Basin).”

In late-day trading on the New York Stock Exchange, Vail Resorts stock had gained more than 7 percent, at $216.59 just before 2 p.m. Vail time.

Vail Daily Business Editor Scott Miller can be reached at and 970-748-2930.

Support Local Journalism