Vail Resorts (MTN) 1Q17 Earnings Takeways – Season Pass Sales On The Rise
Vail Resorts (MTN) released 1Q2017 earnings this morning, a quarter which is the weakest one historically with Northern Hemisphere ski resorts operations inactive. Financial results were lower than expected, with EPS at ($1.70) vs. consensus ($1.57) and Revenue at $178.3M vs. $183.73M. However, investors were pleased with management’s report of higher season pass sales, as well as higher FY2017 guidance range to $567M-$597M, including newly acquired Whistler-Blackcomb operations costs.
Transaction costs from the Whistler-Blackcomb acquisition were $2.8M which, along with a $2.6M off-season operation deficit resulted in $5.6M EBITDA loss for the quarter form their sole Canadian resort. Overall net loss for 1Q2017 was $62.6M, vs. $59.6M loss YoY. Resort Reported EBITDA loss was 53.3M, up from $46.5 YoY.
The Lodging segment’s average daily rates showed an increase of 8.9% YoY with the company benefiting from increased summer tourism, specifically at Grand Teton WY, and all Colorado locations. Off-season revenues for the Colorado-based resort, lodging and real estate operator are generated by dining, retail, lodging rentals, summer activities, as well as their Perisher Australian ski resort’s winter season. Management indicated strong summer attendance at US mountain resorts, with Vail and Heavenly locations opening Epic Discovery this year, a summer-themed mountain park attraction featuring zip lines, alpine coaster, guided tours and other activities.
Season pass unit sales through December 4th were up ~16% and, with less promotional pricing this season, sales in dollars were up ~20%, again YoY. These numbers do not include Whistler BC or Australian operations sales.
CEO Rob Katz also indicated that US accommodation bookings for the remainder of the season are slightly ahead of last year. He also mentioned that November was a warm month up to around Thanksgiving but has since turned colder, with snowfall, and that early-season skiing has already began. Lastly, the Canadian lodgings were said to be “trending well ahead” of last year’s numbers, with early winter snowfall and an advantageous Canadian versus US dollar exchange rate.
