Acquisitions, Summer Traffic Boost Vail Resort’s Q1 Retail Sales

Retail/rental cost of sales rose 4.2 percent to $16.9 million, or 58.5 percent of revenue, down 217 basis points from the year earlier quarter. Vail Resorts owns Specialty Sports Ventures, which operates more than 185 specialty sports stores both in or near its ski resorts and in the San Francisco, Salt Lake City and Colorado Front Range regions they draw from. Its eight mountain resorts include Vail, Breckenridge, Keystone and Beaver Creek in Colorado; and the Heavenly, Northstar and Kirkwood mountain resorts in the Lake Tahoe area of California and Nevada. Since last winter it has acquired the Canyons mountain resort in Park City, UT as well as the “urban resorts” of Afton Alps and Mount Brighton, which serve the Minneapolis and Detroit markets. It acquired Hoigaard’s in April, 2013.

 

 

Excluding acquisitions, the company said its Mountain Revenues grew 5.9 percent and its Lodging revenues grew 3.5 percent due to growing summer traffic to its resorts. While MTN loses money in its fiscal third and fourth quarters because ski operations are closed, it is investing in mountain biking trails, zip lines, canopy tours and other recreational amenities to attract more summer traffic. The company said Lodging revenues would have grown more had the government not closed Grand Teton National Park a month earlier than usual due to the budget impasse. MTN owns five lodges surrounding the park.

 

 

While MTN had hoped to break ground on a host of summer amenities next summer, CEO Rob Katz said it looks like construction won’t start until 2016 to allow more time for the U.S. Forest Service to establish rules and issue permits under the Ski Area Recreational Opportunity Enhancement Act, which was signed into law in November, 2011.

 

 

Regarding the 2013/2014 ski season, Katz said early season conditions and season pass sales are strongest in Colorado, followed by Utah and then the Tahoe region. As of Dec. 7, sales of its season passes for this season were up approximately 13 percent in units and approximately 16 percent in dollars compared with the same period in 2012, including acquisitions in both periods. That was the largest percentage increase since 2008, when MTN launched its Epic Pass, which can be used at any of its resorts and even affiliated resorts in Europe. The program has been such a hit in Minneapolis and Detroit that MTN is actively seeking to acquire or partners with urban resorts in the Northeast that it could plug into the program, Katz said.