Vail Resorts posts record quarter
NEW YORK – Adam Aron nearly burst into song Thursday as he announced Vail Resorts’ third quarter performance numbers.
Vail’s CEO Aron, in New York on a conference for Rockresorts International – a luxury resort hotel management company in which Vail owns a major portion – referred to a Broadway show as he glowed about the company’s best-ever quarter.
“There’s a Broadway tune, “Honey, everything’s coming up roses,'” Aron said.
“That describes Vail’s fiscal third quarter. It was not only a record third quarter, but the best quarter financially in the history of our company. This is something we never dreamed could be possible heading into this ski season just a few short weeks following the Sept. 11 attacks and in the face of a weakened economy.”
Resort revenue for the quarter increased 10.3 percent to $242.4 million from the comparable period in 2001. Real estate revenue for the third quarter also increased, from $4.5 million to $6.4 million for the same period last year – a 29.4 percent increase.
The good financial news comes in the face of not-so-wonderful and downplayed news about skier visits. Aron referred only briefly to the fact skier visits for the fiscal 2002 season, which ended April 28, were down 4.3 percent from the prior year. VR’s four Colorado resorts – Beaver Creek, Breckenridge, Keystone and Vail – recorded 4.7 million skier visits for fiscal 2002.
Keeping the news conference on an overwhelmingly positive note, Aron said the financial report shows VR’s success depends not just on snow, but on its hospitality and retail business.
“We had strong season pass sales within Colorado … ending the year over 11 percent ahead of last year,” he said. “Lift ticket revenue – up 6.4 percent year-over-year thanks to an increase in prices – was our company’s best ever. Resort revenue per skier visit also reached record levels. Contrary to popular myth, we did all this with just average snow at our Colorado resorts.”
In fact, far below average snow. At Keystone, snowfall was about 50 percent of normal throughout the season, Aron said.
“Vail Resorts does not need stellar snowfall to succeed,” he said, adding that even with minimum snowfall, hospitality and retail components can make a guest’s experience.
Resort revenues also grew, by more than 10 percent.
“While our revenues performed nicely this season, our concern that revenues might have performed otherwise caused us to manage our costs tightly all season long,” Aron said. “Although skier visits for the season dropped 4.3 percent, most of that decrease was the result of not really opening our resorts until after Thanksgiving. The lost results were not all that consequential given what is typically cheaper-than-cheap early season pricing.”
All this good financial news in what many had feared would be a poor year for any tourism-related business leaves Aron optimistic about the future.
“As for fiscal 2003, we are extremely bullish barring a second major act of terrorism on U.S. soil,” he said, referring to the Sept. 11 attacks.
Aron pointed to four up-and-coming or ongoing VR projects that support that theory, including the acquisition of Heavenly Lake Tahoe, the signing of a development agreement between the town of Breckenridge and Breckenridge Ski Resort that allows for major development on Peaks 7 and 8, the impending grand opening of Eagle County’s Red Sky Ranch golf course and redevelopment in Vail Village.
Jane Reuter can be reached at 668-3998, ext. 229, or by e-mail at email@example.com
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