Vail Resorts: Quarterly pass sales jump
Vail Resorts CEO Rob Katz Friday announced that the company would pay a quarterly dividend of 81 cents per share for the first quarter of its 2017 fiscal year. That dividend will be paid Jan. 12 to those who own company stock as of Dec. 28.
Vail Resorts stock was selling at 167.99 in late-day trading Friday, up 7.07.
BROOMFIELD — The way Vail Resorts’ fiscal year is set up — from Aug. 1-July 31 — the company always loses money in its first quarter. But there was also a good deal of good news.
Vail Resorts CEO Rob Katz talked mostly about the good news during a Friday conference call with financial analysts.
The company’s first-quarter loss this year edged up from the same quarter in the previous year, from $59.6 million in 2015 to $62.6 million this year.
On the other hand, the company’s pass sales in the quarter posted a 16 percent gain in units, and a roughly 20 percent increase in revenue.
Katz said he expects bringing the recently acquired Whistler Blackcomb ski resort into Vail Resorts Epic Pass programs for the 2018 fiscal year could provide a boost in sales. The acquisition of that Canadian resort may also help the company re-capture some international guests lost to U.S. resorts because of the strength of the dollar vs. other currencies.
Whistler also brings a list of pass customers, and Vail Resorts has over the past few years effectively used that information to drive pass sales.
650,000 Epic passes?
While pass sales are growing, analyst Connor McKnight, of Wells Fargo, noted that pass sales still make up about 40 percent of the company’s lift revenues.
Katz replied that the company feels “very good” about its pass and day-ticket sales, but added that Whistler’s pass holders could boost that ratio.
Katz noted that Whistler’s previous owners weren’t as active in terms of customer retention efforts, noting that Vail Resorts in the past few years has increased its success on that front.
Pass sales were particularly strong in the company’s strongest destinations. Growth in the Chicago area was particularly robust, Katz said. Vail Resorts has just completed improvements at the Wilmont Mountain ski area near that city.
Overall, the company expects to sell more than 650,000 passes including those at Whistler and its Epic Pass sales in Australia.
While the first quarter is always a money-loser for the company, Katz said the company is pleased with the results of its first summer of Epic Discovery activities at Vail and Heavenly at Lake Tahoe.
Katz acknowledged that revenue fell a bit short of expectations, adding that construction on some of the attractions wasn’t complete until July. But, he added, visitation was “outstanding,” adding that if some of the attractions had opened a bit earlier, the company would have hit its revenue projections.
With winter now in full swing, Katz said the company’s lodging reservations are looking up.
Lodging revenue for the first quarter increased 4.4 percent compared to the first quarter of the previous fiscal year, with revenue increasing by 16.6 percent.
November results were below expectations, Vail Resorts Chief Financial Officer Michael Barkin said. That’s due to a warm fall in much of the western U.S. But, he added, November results generally account for a relatively small portion of ski season revenue. Once snow and cold temperatures settled in, Katz said the company’s resorts have been performing roughly as expected.
Those results into early December have the company “reiterating” its earnings guidance issued for the fiscal year.
Barkin said the company expects to record between $567 million and $597 million in resort-reported earnings before interest, depreciation, taxes and amortization.
Katz said full details will be released in March, but the company’s capital spending plan for 2017 is starting to take shape, and could total $103 million in spending.
Katz said the company is already committed to upgrading the Northwoods chairlift at Vail and the Falcon lift at Breckenridge from four-seat to six-seat chairs. The lift upgrades also include putting a six-place chair at the Montezuma lift at Keystone. Keystone will also see upgrades to its on-mountain restaurant.
The final capital project will also include upgrades at Whistler, Katz said.
While snow is finally coming to resorts in Colorado and Utah — and reservation inquiries have responded — Katz said Whistler has already received more than 10.5 feet of snow so far.
Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, email@example.com or @scottnmiller.
The person found in the Blue River on Monday afternoon has been identified as John Scott Still, 53, according to the Summit County Coroner’s Office.