Vail Resorts Inc. reported that retail/rental sales rose to $20.8 million in the fourth quarter ended July 31, up 11.9 percent from a year earlier as summer visitation to its growing portfolio of mountain resorts continued to grow.


Retail cost of sales for the quarter reached $12.1 million, up 16.9 percent from the fourth quarter of 2011. Dining and other revenues at the company rose 14.0 and 9.2 percent respectively.


 

On a full fiscal year basis, the stronger summer business and strong advance sales of season passes for the upcoming season helped mitigate a drop off in skier visits last winter at its mountain resorts. Nevertheless, the company reported net revenues for the year ended July 31, 2012 declined as real estate sales plunged and lodging revenues dipped. Net income fell 52.3 percent to $16.4 million for the full fiscal year.

 
Vail Resorts reported that sales of season passes through Sept. 23, 2012 for the upcoming 2012/2013 ski season were up approximately 17% in units and approximately 21% in sales dollars versus the comparable period in the prior year, adjusted as if its recently acquired Kirkwood resort were owned in both periods. Based on historical patterns, approximately 60% of our total sales are made by this date.


In the Mountain Segment, which includes sales of lift tickets, net revenues actually increased 1.9% for Fiscal 2012 despite total skier visits declining 12.1% compared to Fiscal 2011, said CEO Rob Katz.

“Several key factors contributed to our Mountain Segment results: the strength of season pass sales, which were up $15.8 million or 13.2% in revenue over a year ago; an increase in our effective ticket price, excluding season passes, of 9.3%; enhanced consumer spending resulting in double-digit growth in yield-per-skier visit in our ski school and dining operations and increased international visitation of approximately 2%,” Katz said. “Each of these factors is a positive indicator as we look towards the upcoming season.”

 

Other Mountain Segment data


  • Total Skier Visits for Fiscal 2012 were 6.1 million, versus 7.0 million in Fiscal 2011, a 12.1% decrease. 
  • Mountain segment net revenue was $766.6 million for Fiscal 2012 compared to $752.2 million in the same period in the prior year, a 1.9% increase. 
  • Mountain Reported EBITDA was $198.9 million for Fiscal 2012 compared to $213.2 million in the same period in the prior year, a 6.7% decrease.  Excluding $3.1 million of Northstar Fiscal 2012 first quarter EBITDA losses and transition costs net of the prior year transaction costs, and $2.6 million of Kirkwood and Skiinfo acquisition timing and acquisition related costs, Mountain Reported EBITDA would reflect a 4.1% decrease from Fiscal 2011.
  • Mountain Reported EBITDA includes $7.6 million and $7.1 million of stock-based compensation expense for Fiscal 2012 and 2011, respectively.
     

Despite the unprecedented adverse weather conditions, Fiscal 2012 Mountain revenue was stable due to increased season pass sales, higher pricing and increased average guest spend.  Total Effective Ticket Price (“ETP”) (calculated by dividing lift ticket revenue by total skier visits) for Fiscal 2012 increased 13.8% to $55.75 from $48.99 in Fiscal 2011, driven by price increases and a decline from Fiscal 2011 in visitation from season pass holders of approximately 1.2 days per pass.  ETP excluding season passes increased by 9.3% and season pass revenue increased by 13.2%, including a 3% increase in units. Both ski school and dining revenues increased in Fiscal 2012 (0.6% and 0.5%, respectively) over the prior fiscal year, with retail/rental revenues increasing 4.3%.  Fiscal 2012 fourth quarter results reflect strong momentum in summer revenues, with Mountain net revenues rising 11.3% to $46.4 million from $41.7 million in the same period of the prior year.


Outlook and fiscal year 2013 guidance
 
Commenting on the Company's season pass sales for the upcoming 2012/2013 ski season, Katz said, “We continue to be extremely pleased with the strength of our season pass sales to date, especially coming off the challenging weather of the past ski season and the record performance we had in season passes last year.  Sales of season passes through September 23, 2012 for the upcoming 2012/2013 season were up approximately 17% in units and approximately 21% in sales dollars versus the comparable period in the prior year, adjusted as if Kirkwood were owned in both periods. 


 

“To date, we have sold approximately 178,000 passes for the upcoming 2012/2013 ski season,” Katz continued. “We've seen strong gains across all our key products and geographies, including from both our destination and regional guests, with particularly strong momentum in Tahoe, with the addition of Kirkwood and the Tahoe Local Pass, and in international markets.  We anticipate seeing continued strength in the Tahoe market and from Europe, particularly with the recently announced addition of 3 days of skiing at Verbier to our Epic Pass. While we believe that a portion of the significant increase in sales to date is due to some timing shifts, we hope to maintain the vast majority of these absolute gains through the rest of the selling period, with a resulting moderation of the ultimate percentage increase in the program.  Based on historical purchasing patterns, approximately 60% of our passes have typically been sold at this point in the selling process. It is also important to remember that all of the pass sales for the upcoming 2012/2013 ski season will be recorded as revenue in Fiscal 2013, over the course of the 2012/2013 ski season. This season pass sales performance provides a strong, pre-season indicator as we head into the 2012/2013 ski season.”
 
Regarding advance Lodging bookings, Katz said, “Although it is still early in the cycle (less than 15% of winter season bookings are historically made by this time), we are pleased that at this point bookings are up in both room nights and revenue over the prior year.”
 
Commenting on Fiscal 2013 guidance, Katz continued, “We would like to announce our guidance for Fiscal 2013.  As always, our visibility on the upcoming season at this point in time is limited.  Our guidance for Fiscal 2013 anticipates a return to more normal weather conditions and the continuation of a challenging, but stable economic environment. Based on our current estimates, our Fiscal 2013 guidance range anticipates Resort Reported EBITDA of between $260 million and $270 million, reflecting a 27% to 32% increase over Resort Reported EBITDA in Fiscal 2012.  Our Real Estate segment results are impacted in any given year by the timing and mix of real estate sold and closed.  For Fiscal 2013, we are estimating Real Estate Reported EBITDA of negative $9 million to negative $17 million, including approximately $2 million of non-cash stock-based compensation expense.  Included in these estimates are Net Real Estate Cash Flow of $15-$25 million (defined as Real Estate Reported EBITDA, plus non-cash real estate cost of sales, plus non-cash stock-based compensation expense, plus change in real estate deposits less investment in real estate).  Net income attributable to Vail Resorts, Inc. is expected to be in a range of $50 to $60 million in Fiscal 2013.” 









































































































































































































































































































Vail Resorts, Inc.


Mountain Segment Operating Results and Skier Visits


(In thousands, except Effective Ticket Price)


(Unaudited)








Three Months Ended


Percentage


Twelve Months Ended


Percentage



July 31,


Increase


July 31,


Increase



2012


2011


(Decrease)


2012


2011


(Decrease)


Net Mountain revenue:
















Lift tickets


$


89



$




nm



$


342,500


$


342,514


0.0


%


Ski school



1






nm




84,292



83,818


0.6


%


Dining



6,619




5,808



14.0


%



68,376



68,052


0.5


%


Retail/rental



20,814




18,602



11.9


%



181,772



174,339


4.3


%


Other



18,891




17,307



9.2


%



89,668



83,468


7.4


%


Total Mountain net revenue


$


46,414



$


41,717



11.3


%


$


766,608


$


752,191


1.9


%


Mountain operating expense:
















Labor and labor-related benefits


$


29,277



$


27,207



7.6


%


$


203,515


$


198,659


2.4


%


Retail cost of sales



12,069




10,320



16.9


%



79,657



71,961


10.7


%


Resort related fees



908




1,037



(12.4)


%



39,557



39,476


0.2


%


General and administrative



23,807




22,030



8.1


%



112,879



104,848


7.7


%


Other



24,262




23,276



4.2


%



132,970



125,422


6.0


%


Total Mountain operating expense


$


90,323



$


83,870



7.7


%


$


568,578


$


540,366


5.2


%


Mountain equity investment (loss) income, net



(66)




18



(466.7)


%



878



1,342


(34.6)


%


Mountain Reported EBITDA


$


(43,975)



$


(42,135)



(4.4)


%


$


198,908


$


213,167


(6.7)


%




























































Twelve Months Ended


Percentage



July 31,


Increase



2012


2011


(Decrease)


Skier Visits








Colorado Resorts



4,853



5,329


(8.9)


%


Tahoe Resorts



1,291



1,662


(22.3)


%


Total skier visits


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