Vail Resorts: Strong second quarter boosted by Tahoe-area visits
VAIL, Colo. — The second quarter of Vail Resorts’ fiscal year falls in the heart of the winter season. The company’s performance this season has been particularly strong.
In a conference call this week discussing the company’s performance in the quarter that ended Jan. 31, Vail Resorts CEO Rob Katz reported increases throughout the company’s operations.
Areas from lift income to revenue generated by lodging rooms have increased from the same period in the previous fiscal year. Across the company, visitation is up by nearly 10 percent.
He said the company continues to see “robust” spending from visitors, adding that the company’s resorts near Lake Tahoe — Northstar, Heavenly and Kirkwood — have seen significant increases in visitors. He also reported double-digit revenue growth at Park City Mountain Resort and Canyons Resort.
Colorado resorts have also seen solid growth, he said, noting that this year’s revenue growth is coming on the heels of a record period in the prior fiscal year.
He said the company’s growth in visitation came primarily from growth in the domestic market. The decline in international visits “moderated” during the period, he said, adding that guests numbers are “stable” from the Mexican and Australian markets.
The Australian market has been particularly good, he said. Guests are coming, and generally stay longer and spend more than those from any other international market.
While Vail Resorts’ two biggest international markets continue their strength, Katz acknowledged that guest numbers from Canada, Brazil and the United Kingdom have declined.
Katz attributed the strength of the domestic market to more sophisticated marketing efforts to those customers. For Australia, he credited that strength in part to the company’s acquisition of Perisher ski resort.
The company had been confident that selling an Australian Epic Pass would benefit U.S. resorts, and he said current performance shows that confidence was well-founded.
In North America, he said Vail Resorts believes its recent purchase of the Wilmot ski area, about 65 miles north of Chicago, will provide a similar boost.
He said the company saw positive results from season pass sales when Vail Resorts bought a pair of urban ski areas in Minnesota and Michigan. Those markets combined have about 470,000 skiers, he said. Wilmot has about 800,000 skiers.
Speaking during a question-and-answer session with analysts, Katz said the company still has growth potential. But that growth will probably come at the company’s newer properties.
He said Vail Resorts continues to examine the prospects of buying other resorts, particularly in other countries, including Japan. The addition of a resort there could help Vail Resorts tap into the growing Chinese market.
But, he said, any future acquisitions need to fit the company’s overall strategy.
“All that stays on our radar, but in a methodical way,” he said.
Scott N. Miller is business editor of the Vail Daily, the Sierra Sun’s sister newspaper based in Vail, Colo.
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