Earnings down, but pass sales up for Vail Resorts

Bob Berwin reports in the June 5, 2009, issue of the Summit Daily News:

Execs hope pass sales will spur visits next season.

Season pass sales and usage continues to be bright spots for Vail Resorts at the end of a challenging season.

In spite of a 20.9 percent drop in bottom line earnings, advance season pass sales for next year are up 37 percent from last year. This revenue is quickly growing into a larger slice of the company's overall revenue picture, from 26 percent in the 2007-8 ski season, to 34 percent for the 2008-9 season.

Total skier visits were down about 5.3 percent for the 2008-9 season. Destination guests made up 57 percent of Vail Resort's total visitation, compared with 63 percent last season. Visits by non-season pass holders dropped by 22 percent.

These results were impacted by the continued severe downturn in the economy.

On the real estate side, Vail Resorts reported revenues of $9.4 million for the third quarter of 2009, compared to $54.5 million for the same quarter last year, resulting in a $4.7 million loss.

The company's operating expenses were down $12.8 million, or 8.1 percent compared to last year. Forest service and credit card fees were down along with labor costs which resulted from a company-wide wage cut implemented in April, 2008.

Lodging revenue was up 3 percent for the third quarter, mainly from revenue generated by Colorado Mountain Express, a recent acquisition of Vail Resorts. But overall lodging revenue was down 26.9 percent. Lodging deals helped drive skier visists, but also pushed down average room rates.

Rob Katz, CEO for Vail Resorts, said he thinks advance sales of season passes for next year will create momentum going into the 2009-10 season.

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