Vails Resorts reports 95% increase in second quarter income

Good news for shareholders of Vail Resorts Thursday after the results for the second quarter of the fiscal year were released. Vail operates real estate, ski resort and lodging segments including Heavenly, Kirkwood and Northstar Mountain Resorts in Lake Tahoe.

Vail Resort's net income was $115.8 million for the second fiscal quarter of 2015, representing a 95.3% increase compared to the same period last year.

The Company's Board of Directors approved a 50% increase in the quarterly cash dividend to $0.6225 per share from $0.4150 per share beginning with the dividend payable on April 15, 2015.

Vail also announced that they have repaid all borrowings used to finance the $182.5 million acquisition of Park City Mountain Resort in September 2014.

They will be spending about $10 million in 2015 for the first major construction efforts for Epic Discovery summer activities at South Lake Tahoe's Heavenly Mountain Resort. The summer capital will be focused on a mountain coaster, canopy tours and summer tubing. In addition, the capital will be used to construct kids' activities on private land at Breckenridge and for significant planning investments for the next phase of construction in 2016 at Vail, Breckenridge and Heavenly.

“Our results were very strong in the second quarter of fiscal 2015, with Mountain revenue increasing 18.2% compared to the prior year," said Rob Katz, Chief Executive Officer. "Total lift revenue increased 22.5%, primarily driven by a 15.9% growth in visitation and a 5.7% increase in effective ticket price.”

"In our June earnings call, we will be providing further guidance on potential incremental capital spending at Heavenly for the summer of 2015 as we assess the timing of regulatory approvals for those projects," Katz continued.

Highlights:
• Total lift revenue increased $43.9 million, or 22.5%, compared to the same period in the prior year, to $239.3 million for the three months ended January 31, 2015, driven largely by a $25.2 million, or 23.9%, increase in lift revenue excluding season pass revenue, attributable to increased visitation at our Colorado resorts, as well as incremental revenue of $11.8 million from the addition of Park City. Season pass revenue increased $18.7 million, or 20.9%.
• Ski school revenue increased by $10.4 million, or 22.1%, and dining revenue increased $6.0 million, or 18.5%, for the three months ended January 31, 2015 compared to the same period in the prior year, driven by increases in visitation and yields as well as the addition of Park City.
• Retail/rental revenue increased $9.3 million, or 10.8%, for the three months ended January 31, 2015 compared to the same period in the prior year, due primarily to increases in retail sales and rental revenue in Colorado and Utah and the addition of Park City.
• Resort net revenue increased $74.6 million, or 16.6%, to $522.4 million for the three months ended January 31, 2015 compared to the same period in the prior year.
• Total net revenue increased $77.5 million, or 17.1%, to $530.2 million for the three months ended January 31, 2015 compared to the same period in the prior year.
• Season-to-date total lift revenue at the Company's nine mountain resorts, including an allocated portion of season pass revenue for each applicable period, was up 8.0% compared to the prior year season-to-date period.
• Season-to-date ancillary spending outpaced skier visitation, with ski school revenue up 2.1% and dining revenue up 4.8% at the Company's nine mountain resorts compared to the prior year season-to-date period. Additionally, retail/rental revenue for resort store locations was up 2.9%.
• Season-to-date total skier visits for the Company's nine mountain resorts were down 0.3% compared to the prior year season-to-date period.

"Our results in February and early March continued the trends we saw in our fiscal second quarter with strength in Colorado offset by shortfalls to our expectations in Tahoe," said Katz. The company expects a $37 million shortfall at Heavenly Mountain Resort.