Despite drought at Tahoe, Vail Resorts reports successful quarter
March 12, 2015
BROOMFIELD, Colo. — The current ski season is a strong one for Vail Resorts, with the company reporting strong second-quarter growth across its skiing and lodging operations.
The company also announced an ambitious capital improvement plan for both winter and summer operations.
During a Thursday conference call with financial analysts, Vail Resorts CEO and company chief financial officer Michael Barkin detailed revenue increases in company operations from pass sales to lodging to ski schools and restaurants.
Those increases came despite a continuing drought near Lake Tahoe, where the company operates the Heavenly and Northstar resorts. Katz said current seasonal snowfall at those resorts is down 43 percent from last season's low snow total.
Snowfall has been affecting visits to those resorts, Katz said, adding that the company's overall success is in part a product of "geographic diversification."
Katz said the company has repaid all the borrowing under the "revolver" portion of its credit that was used to finance the $182.5 million acquisition last year of Park City Mountain Resort.
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That resort, along with the adjacent Canyons resort, also operated by Vail Resorts, is the subject of plans in the coming year that Katz called "transformative." Katz said Vail Resorts intends to spend about $50 million this year on projects that will include linking the two resorts to create the largest ski area in North America. The local-government approvals for those projects are moving smoothly, Katz said, and work is expected to start this summer.
Vail Resorts intends to spend $60 to $65 million at its other resorts in the next year, including replacing the Avanti lift at Vail with a six-place chairlift and improving the snowmaking system at Beaver Creek.
Part of that spending will include about $10 million to create the first phase of the company's Epic Discovery summer programs. Vail will see a mountain coaster, canopy tours and a summer tubing area, while children's activities will be created on private property near Breckenridge.
As of 11:30 a.m. Mountain time, Vail Resorts' stock was up $9.09, to $94.10 per share.
— The Vail Daily is a sister paper of the Sierra Sun. Business Editor Scott Miller can be reached at 970-748-2930, firstname.lastname@example.org or @scottnmiller.