Lauren Glendenning
lglendenning@vaildaily.com
Vail, CO Colorado

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March 10, 2010
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Vail Resorts' skier visits drop

VAIL, Colorado --Vail Mountain's early season snow, or lack thereof, affected its fiscal 2010 second quarter skier visits with a 7.7 percent decline over the same period in 2009.

That being said, skier visits through March 7 of this year at the company's five ski resorts are up .4 percent over last season.

Vail Resorts announced its second quarter earnings Wednesday for the period covering the early ski season - November, December and January. The results show Vail Resorts is still facing many challenges amid the struggling national economy and a not-so-snowy start to the season,

Overall, the company's net revenue for the second quarter was 22.7 percent lower than the same period last year, mostly because of the timing of real estate closings, Vail Resorts Chief Executive Officer Rob Katz said.

There were no closings for the second quarter this year, and closings for the second quarter of 2009 included revenue from 10 closings at Vail Resorts' properties totaling more than $88 million. The second quarter for 2010 brought in a real estate net revenue of just $900,000, compared to the previous year's $89.2 million.

"There are no real estate closings expected until the fourth quarter," said Vail Resorts Chief Financial Officer Jeff Jones.

Locally, the company's Ritz-Carlton project in Vail is set to be completed this year. Katz said the company is "cautiously optimistic" that units already with deposits will end up closing.

"We do have to acknowledge that for certain buyers, their economic situation has changed," Katz said.

The company did not reveal how many Ritz-Carlton units already hold deposits, how many are still available and how many have already closed.

In the lodging segment of company business, Vail Resorts shows a 6 percent decline over the same period the year before. Occupancy was down 6.9 percent, "primarily due to significant declines in transient guest visitation," Katz said.

Keystone is responsible for the majority of the decline, as the company's resorts are up 1 percent over last year in lodging when excluding Keystone from the equation.

Mountain and resort reported EBITDA, or earnings before interest, tax, depreciation and amortization, for the second quarter improved from the same period last year by 3.6 percent and 2 percent respectively, according to the company's earnings report.

Katz said he's pleased with his company's performance in the second quarter, "particularly given the low early season snowfall levels at our Colorado resorts and a still challenging economy."

The slow start to the season, however, will make it hard for the company to reach the goals it outlined last fall for fiscal 2010, Jones said.

Season-to-date numbers show that ski school and retail revenues through March 7 are up overall compared to last year's ski season through March 8, 2009, with 3.8 percent and 5.5 percent respectively.

Season to date lift ticket revenues are up 1.6 percent. Dining revenue, which was significantly down for the second quarter, is looking better with a 1.3 percent decline when looking at the season to date.

"While we are experiencing a number of favorable operating trends during this year, we currently believe the slow start to the ski season, which lasted through the beginning of the Christmas holiday period, will make it challenging for us to reach the top end of the guidance we issued in September 2009 and reiterated on Dec. 8, 2009 for resort reported EBITDA and net income attributable to Vail Resorts, Inc.," Katz said.

Community Editor Lauren Glendenning can be reached at 970-748-2983 or lglendenning@vaildaily.com.


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The Aspen Times Updated Mar 10, 2010 07:55PM Published Mar 10, 2010 07:53PM Copyright 2010 The Aspen Times. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.