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Analyst sees 9 percent drop at Breckenridge, Keystone

EDWARD STONER
vail daily

VAIL ” Citing the troubled economy, a Vail Resorts analyst said Thursday he expects fewer skier visits for the company’s mountains this winter.

Will Marks, stock market analyst for JMP Securities in San Francisco, said he predicts a 9 percent drop in skier visits and a 7 percent fall in mountain revenue for the company for the next year.

“If the last downturn is any indication, when total skier visits fell by 5 percent during the 2001-2002 season, the current unique economic and financial environment could mean a difficult year (or more) ahead,” Marks wrote in a note to investors.

Vail Resorts, traded on the New York Stock Exchange, owns Vail, Beaver Creek, Breckenridge, Keystone and Heavenly.

“We certainly expect skiers to show up this season, but visibility is limited given the poor economic outlook,” Marks wrote. “Potential destination visitors likely want some assurance that a trip is worthwhile, with decent snow, if they are planning to stay at any ski resort.”

Marks noted that skier visits for the company fell 5 percent during the 2001-02 season, in the aftermath of 9/11 and the midst of a recession. He said his research shows there is a correlation between the state of the economy and Vail’s revenue and skier visits, though the correlation doesn’t seem particularly strong.

“In fact, Vail management has indicated in the past that snowfall is the overriding determining factor for the success of a ski season,”Marks wrote.

Michael Berry, president of the National Ski Areas Association, agreed that snow is going to be a huge factor this year.

“History tells us time and time again, during times when we have economic headwinds, that if the snow is good, people will come,” he said.

With good snow, particularly good early-season snow, the U.S. will meet its four-year average of 58 million skiers, Berry said.

Ski areas are already showing strong bookings for the busy times of the seasons, he said.

Buzz Schleper, longtime owner of Buzz’s Ski Shop in Vail, said the new, discounted, six-resort Epic Pass was introduced at just the right time.

“I think timing is everything, and we got lucky on this one,” he said.

Because of the pass, vacationers will be scheduling two or three weeklong visits this year, he said.

“Of course, the snow is always key,” he said. “We need great snow for Christmas, and it wouldn’t hurt to have good snow off the bat at Thanksgiving, too.”

Vail Resorts spokeswoman Kelly Ladyga said she couldn?t comment on the analysts’ report. Ladyga said Vail Resorts has introduced many discount programs, including the Epic Pass, to make it easier for people to come visit the company’s resorts this year despite economic troubles.

Staff Writer Edward Stoner can be reached at 970-748-2929 or

estoner@vaildaily.com.


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