Vail Resorts to spend big in Utah; Tahoe resorts see dip in pass sales
BROOMFIELD, Colo. — Industry-watchers suspected Vail Resorts had big plans for Utah when it purchased Park City Mountain Resort earlier this year. The first of those plans are now public, and the industry-watchers were right.
During a Monday conference call with industry analysts to discuss the company’s performance in the first quarter of its 2015 fiscal year, Vail Resorts CEO Rob Katz announced plans for $50 million in capital spending to link Park City with the Canyons, the Utah resort the company took control of in 2013.
The big part of the plan is a gondola to link Park City with Canyons, as well as a new, six-place lift and a new quad lift at the resorts. Other plans also call for building a 500-seat restaurant at Park City, and upgrading a 250-seat restaurant at Canyons.
The plan also includes upgrading snowmaking at in the Iron Mountain area of Canyons, and as much as $5 million in what the company calls “catch-up” maintenance at Park City.
The gondola, and the ability to ski both resorts on one lift ticket, will create what is effectively the largest ski resort in North America, with more than 7,300 acres of skiable terrain.
Katz called the coming work in Utah “transformative,” and a release from the company anticipates that revenue will improve as the ski experience is upgraded.
Since the resorts in Utah are on private property, the construction work depends on approvals from town and county officials.
While the Utah resorts drew much of the attention, Katz also noted that Vail’s Avanti lift, currently a quad, will be replaced by a six-place lift in time for the 2015-16 season.
Vail Resorts’ fiscal year begins Aug. 1, and as is usually the case, the company lost money during the period, since there’s little in the way of resort activity during that time. But, Katz added, the ski season to come looks strong in several ways, including:
• Snow. Colorado resorts in particular have the best early season snow in years. California resorts, which have been hit hard by a multi-year drought, received some snow in recent weeks, and a major storm this week could bring “multiple feet of snow.”
• Pass sales. Katz said pass sales have increased by 13 percent — and 16 percent in revenue — over the previous years. Despite what Katz called a “dip” in pass sales for Tahoe-area resorts, increases have been particularly driven by news about the Utah resorts. Katz said pass sales in some of the company’s main destination markets, both international and domestic, have also shown strength. Overall, roughly 400,000 people have purchased some sort of pass. That represents about $200 million in revenue for the company.
• Lodging: Roughly 50 percent of Vail Resorts’ ski-season lodging is already booked, and at higher daily rates.
• Real estate: The company closed sales of two units at the Ritz-Carlton Residences in Vail and one at One Ski Hill Place in Breckenridge.
• Guidance: The company expects its total “earnings before interest, taxes, depreciation and amortization” to be between $327 and $354 million.
— Scott Miller is business editor of the Vail Daily, a sister paper of the , Tahoe Daily Tribune, Sierra Sun and North Lake Tahoe Bonanza.