Vail Resorts reports record pass sales
June 12, 2017
Vail Resorts' fiscal year begins on Aug. 1. That means its third quarter is the heart of ski season. The company did well during that period.
In a Thursday morning, June 8, earnings call, Vail Resorts President and CEO Rob Katz, along with Chief Financial Officer Michael Barkin, detailed the company's performance through April 30, as well as pass sales through May 30.
Pass sales are on pace to set another record, Katz said. Through May 30, sales of all types of the company's Epic Pass have increased about 10 percent in unit sales and 16 percent in revenue during the same period in the 2016 fiscal year.
Overall, Katz said various season pass sales account for 44 percent of the company's North American lift revenue. Pass buyers are split between local and destination skiers, Katz said.
An unrestricted Epic Pass costs $859 right now and provides access to all of the company's resorts in North America (including Northstar California in Truckee) and Australia, as well as limited access to several European resorts.
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Katz said he expects continued growth in pass sales, especially as customer data-collection systems in Whistler and the company's latest acquisition in Stowe, Vt., are brought into Vail Resorts' systems.
Katz said Whistler last season collected information on only about 20 percent of its non-pass guests. Other Vail Resorts ski areas collect data on 96 percent of those guests.
That data allows Vail Resorts to send personalized marketing information to those guests, helping drive pass sales.
Katz said even with that level of customer tracking, the company's data-collection efforts are still relatively young.
With better data collection will come more growth, especially as Whistler and Stowe guests are eligible for various Epic passes.
While guest spending at resorts in Colorado was in line with 2016's results, Katz said there was "robust" growth elsewhere.
During the 2016-17 ski season, visitation grew by 26 percent, driven in part by gains at Whistler Blackcomb, and at the company's resorts in the Lake Tahoe area in Nevada and California.
Katz called Whistler's performance "exceptionally strong," citing good conditions and growth in destination visits as factors.
Whistler's destination visits saw a strong boost in international guests, Katz said, due in part to the weakness of the Canadian dollar relative to the U.S. dollar. The company's U.S. resorts also saw declines in international visits.
Katz said the strongest growth in the company came at Park City, Utah, and the Tahoe-area resorts reported record revenue.
Vail Resorts announced a few years ago its exit from the real estate development business. This year, the last available units have been sold at The Ritz-Carlton Residences Vail and One Ski Hill Place in Breckenridge.
While Vail Resorts remains the largest resort operator in North America, Aspen Skiing Co. and KSL Capital Partners have made a splash this year with the acquisitions of Intrawest, which holds Steamboat and Winter Park resorts, among others, and Mammoth Resorts, whose portfolio includes Mammoth Mountain in California.
Anthony Powell, an analyst for Barclay's, asked Katz how that new competition affects Vail Resorts.
"It's a good thing for the industry," Katz said. "The more the skiing public has more choices, and the more value opportunity there is, that builds broad enthusiasm. I'm comfortable that we're going to do great in that environment."
While Vail Resorts' stock has gained 33 percent in value since Jan. 1, the earning's call got a lukewarm greeting from investors. At the Thursday close of trading on the New York Stock Exchange, the company's stock sold for $210.85 per share, a decline of almost 2 percent.
According to an Associated Press report, the company missed its estimated per-share earnings and revenue.
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