Vail Resorts reports 32% increase in earnings to close 2021-22 season
Company reports significantly more revenue over same period in 2021
Vail Resorts CEO Kirstin Lynch attributed the strong growth to close out the North American ski season to the company’s guest experience, “especially post-holiday,” during a Thursday call with investors.
For the third quarter of fiscal 2022, which ended April 30, 2022, Vail Resorts reported a net income of $372.6 million, compared to $274.6 million in the same period in the prior year. The company also recorded $610.5 million in earnings before interest, taxes, depreciation and amortization for the third fiscal quarter of 2022, compared to $462.2 million for the third fiscal quarter of 2021.
Lynch said the growth was due to the compelling resort network Vail Resorts boasts, the value proposition of visiting one of those resorts, and the guest experience the company provided.
“Post the challenges of omicron and the low snow, once we got through that time period, we delivered a very strong guest experience,” Lynch said.
Challenges included lifts left unspinning, lessons unavailable and restaurants closed while big snowstorms and bigger crowds created a barrage of bad press. Vail Resorts exceeded expectations last season, selling 2.1 million pre-sold passes.
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But much of that was addressed in the company’s March earnings call as the 2021-22 season was still underway. On Thursday, investors were encouraged to look forward — to new terrain (Keystone), new resorts (Switzerland and Pennsylvania), and new and upgraded lifts (about a dozen other places including Vail.)
Pass sales for next season are already up about 9% in units and 11% in sales dollars as compared to the same period of last year, investors were told, however, “the majority of the selling period for passes is still to come, so we’re very early in the selling cycle,” Lynch added.
One area which is more nebulous is the company’s effort to return to full staffing, a $175 million increase in expected labor expense in fiscal 2023 compared to fiscal 2022 expected labor expense. Lynch didn’t have much information to share on how the efforts to staff up are looking so far.
“In terms of labor and the labor market and what we’re seeing there, I would say it’s too early to tell for the winter season given it’s June right now,” Lynch said. “We are staffing up for our summer operations and certainly feeling good about tracking to normal staffing for summer.”
When it comes to new lifts and expansions, Lynch said Vail Resorts will spend $325 million this summer, much of which will go toward the installation of 21 new or replacement lifts at 14 different resorts.
“We are committed to consistently increasing capacity through lift, terrain and food and beverage expansion projects,” Lynch said.
And in Switzerland, Lynch said the company is viewing its 55% acquisition of Andermatt resort as a strategic opportunity to expand into Europe.
“We have a lot to learn, and a lot to do, to ever actually get to the point where we have a network of resorts in Europe, and our first step in Andermatt, and we’re very excited about it,” Lynch said.