Vail Resorts Results

Vail Resorts Reports Fiscal 2015 Fourth Quarter and Full Year Results

Lodging net revenue (excluding payroll cost reimbursements) was $244.2 million for fiscal 2015 compared to $232.1 million for the prior fiscal year, a 5.3% increase. ADR increased 5.3% and RevPAR increased 12.0% in fiscal 2015 at the Company's owned hotels and managed condominiums, compared to the prior fiscal year.

Vail Resorts

Vail Resorts, Inc. (NYSE:  MTN) yesterday reported results for its fourth quarter and fiscal year ended July 31, 2015 and provided its outlook for the fiscal year ending July 31, 2016.

Highlights

  • Fiscal 2015 Resort Reported EBITDA, excluding the non-cash gain on the Park City litigation settlement, was $349.4 million. This includes incremental EBITDA of $7.4 million from Perisher and $5.5 million of litigation, transaction and integration related expenses associated with the Park City acquisition.
  • Net income attributable to Vail Resorts, Inc. was $114.8 million for fiscal 2015.
  • Sales of season passes through September 20, 2015 for the upcoming 2015/2016 ski season (excluding Perisher pass sales) increased approximately 16% in units and 22% in sales dollars versus the comparable period in the prior year.
  • The Company issued its fiscal 2016 guidance range, including a full year of Perisher results, with Resort Reported EBITDA expected to be between $405 million and $430 million.

Commenting on the Company's fiscal 2015 results, Rob Katz, Chief Executive Officer, said, "We achieved another year of record-breaking Resort revenue and Resort Reported EBITDA. We are very pleased to complete the year with Resort Reported EBITDA, excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, of $342.0 million which was within our original guidance range, despite the impact of challenging conditions in Tahoe throughout the season and in Utah this spring. Our season pass program continued to drive growth, customer loyalty and financial stability with season pass revenue, excluding Perisher, increasing 20.9% compared to the prior year. We experienced another outstanding year in Colorado with strong growth in effective ticket price ("ETP") and guest spending in our ancillary businesses. Our summer business continues to grow as we build out Epic Discovery activities at Vail, Breckenridge and Heavenly and tap into the strong existing summer tourism in those markets. Finally, disciplined cost control played a critical part in achieving fiscal 2015's strong results and increasing Resort EBITDA Margin by 330 basis points from fiscal 2014 to 25.6% in fiscal 2015, excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA."

Commenting on the Company's recent acquisitions, Katz said, "We are excited to head into fiscal 2016 with an even stronger network of world-class resorts and very attractive growth opportunities. In September 2014, we announced the acquisition of Park City and subsequently integrated the resort for the 2014/2015 ski season and outlined the $50 million transformational capital plan to connect Park City and Canyons for the 2015/2016 ski season. This transformational plan, one of the most ambitious and impactful investments in U.S. ski industry history, is on schedule and on budget and we are excited to welcome guests to the new Park City this winter, now the largest ski resort in the United States. On June 30, 2015, we closed on the acquisition of Perisher in Australia, our first international mountain resort. We have been thrilled with the in-season integration with the Perisher team and strong season to date results. Due to the timing of the closing, our results only include one month of peak season operating results from Perisher, which generated Resort Reported EBITDA from operations of AU$17.7 million (US$13.1 million excluding US$5.7 million of transaction, duties and transition costs). As we noted on our last earnings call, we saw very strong season pass growth of 68% heading into the season at Perisher and continue to see strong demand for the Epic Australia Pass since launching sales on August 14, 2015 for the 2016 Perisher season."

Katz added, "For fiscal 2015 total Mountain net revenue increased 14.6% to $1.1 billion. Excluding the one month of Perisher results, total skier visits increased 6.5% driven by the addition of Park City and strong Colorado visitation, particularly at Breckenridge, partially offset by the 16.4% decline in Tahoe visits and challenging results at Canyons in the spring. Total ETP increased 10.1%, excluding Perisher, driven largely by season pass and lift ticket price increases across our resorts along with the migration of guests to our proprietary online advanced purchase channels. Our ancillary businesses also saw strong growth with ski school, dining and retail/rental revenue, excluding Perisher, up 12.9%, 10.2% and 3.2%, respectively, compared to the prior year. With a strong U.S. economy and robust high-end consumer demand for ski vacations, we are continuing to leverage our network of vertically integrated resorts and sophisticated marketing to drive guest spending."

Regarding Lodging, Katz said, "Fiscal 2015 was very strong for our Lodging business with net revenue growing 5.1% and Lodging Reported EBITDA increasing 29.6% compared to fiscal 2014. These improvements were primarily driven by a 250 basis point improvement in occupancy and a 5.3% growth in average daily rate ("ADR"), resulting in a 12.0% improvement in revenue per available room ("RevPAR") compared to the prior year. The Colorado lodging market remained strong throughout the year due to robust transient demand and ADR growth. We also experienced strong demand and increased park visitation at Grand Teton Lodge Company in the fourth quarter, which led to substantial RevPAR and ancillary revenue growth."

Turning to the real estate business, Katz commented, "We continue to see positive momentum and strong demand in the resort real estate markets where we operate.  We generated $28.9 million of Net Real Estate Cash Flow in fiscal 2015 resulting from strong sales activity and a strengthening real estate market. During the fourth quarter we closed on five One Ski Hill Place units and two Ritz-Carlton Residences, Vail units. For the full fiscal year, we closed on fourteen One Ski Hill Place units and five Ritz-Carlton Residences, Vail units, as well as a property in Breckenridge that will be developed into a Marriott Residence Inn and a development land parcel in Vail. Since July 31, 2015, we have closed on two Ritz-Carlton Residences, Vail units and one land sale, and we currently have two One Ski Hill Place units under contract, which are expected to close in the first and second fiscal quarters of fiscal 2016. As of September 25, 2015 we have seven Ritz-Carlton Residences, Vail units and four One Ski Hill Place units remaining to be sold and approximately $97.3 million of real estate held for sale and investment associated with land parcels at our resorts."

Katz continued, "Our balance sheet continues to be very strong. We ended the fiscal year with $35.5 million of cash on hand and $185.0 million of borrowings under the revolver portion of our senior credit facility, primarily as a result of funding the Perisher acquisition on June 30, 2015. Our Net Debt was 2.2 times trailing twelve months Total Reported EBITDA, which includes $317.5 million of capitalized long-term obligations associated with the Canyons transaction. During the fourth quarter of fiscal 2015, we completed the redemptions of $215.0 million 6.50% Senior Subordinated Notes and $41.2 million 6.95% Eagle County Industrial Development Bonds, which were funded by a $250.0 million term loan under our senior credit facility and cash on hand. Additionally, I am very pleased to announce that our Board of Directors has declared a quarterly cash dividend on Vail Resorts' common stock. The quarterly dividend will be $0.6225 per share of common stock and will be payable on October 26, 2015 to shareholders of record on October 9, 2015."

Operating Results

A complete Management's Discussion and Analysis of Financial Condition and Results of Operations can be found in the Company's Form 10-K for the fiscal year ended July 31, 2015 filed today with the Securities and Exchange Commission.  The following are segment highlights:

Mountain Segment

  • Total skier visits for fiscal 2015, excluding Perisher, increased to 8.2 million, a 6.5% increase compared to the prior fiscal year.
  • Season pass revenue, excluding Perisher, increased $37.1 million, or 20.9%, compared to the prior fiscal year.
  • ETP, excluding season pass holders and Perisher, increased $7.04, or 8.8%, compared to the prior fiscal year.
  • Mountain Reported EBITDA for fiscal 2015, excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, increased $68.2 million, or 27.1%, to $320.3 million, compared to the prior fiscal year.
  • Mountain Reported EBITDA includes $11.8 million and $10.3 million of stock-based compensation expense for fiscal 2015 and fiscal 2014, respectively.

Lodging Segment

  • Lodging net revenue (excluding payroll cost reimbursements) was $244.2 million for fiscal 2015 compared to $232.1 million for the prior fiscal year, a 5.3% increase. 
  • ADR increased 5.3% and RevPAR increased 12.0% in fiscal 2015 at the Company's owned hotels and managed condominiums, compared to the prior fiscal year.
  • Lodging Reported EBITDA increased 29.6% to $21.7 million for fiscal 2015 compared to the prior fiscal year.
  • Lodging Reported EBITDA includes $2.6 million and $2.2 million of stock-based compensation expense for fiscal 2015 and fiscal 2014, respectively.

Resort - Combination of Mountain and Lodging Segments

  • Resort net revenue was $1,358.6 million for fiscal 2015, an increase of 12.7%, compared to the prior fiscal year.
  • Resort Reported EBITDA increased 36.1% to $365.8 million for fiscal 2015 (including the non-cash gain on the Park City litigation settlement and Perisher EBITDA), compared to the prior fiscal year.

Real Estate Segment

  • Real Estate segment net revenue was $41.3 million, a decrease of $7.4 million compared to the prior fiscal year.
  • Net Real Estate Cash Flow was $28.9 million for fiscal 2015.
  • Real Estate Reported EBITDA was negative $6.9 million for fiscal 2015, compared to negative $7.0 million for the prior fiscal year. 
  • Real Estate Reported EBITDA includes $1.3 million and $1.7 million of stock-based compensation expense for fiscal 2015 and fiscal 2014, respectively.

Total Performance

  • Total net revenue was $1,399.9 million for fiscal 2015 compared to $1,254.6 million in the prior fiscal year, an 11.6% increase.
  • Net income attributable to Vail Resorts, Inc. was $114.8 million, or $3.07 per diluted share, for fiscal 2015, compared to net income attributable to Vail Resorts, Inc. of $28.5 million, or $0.77 per diluted share, in the prior fiscal year.

All references to Perisher results are in U.S. dollars, unless otherwise noted.

Season Pass Sales

Commenting on season pass sales, Katz said, "We are extremely pleased with our season pass sales to date. Through September 20, 2015, season pass sales increased approximately 16% in units and 22% in sales dollars, compared to the prior year period ended September 21, 2014 (excluding Perisher Freedom Pass and Epic Australia Pass sales in both periods). It's encouraging that we maintained our growth rates from our early season sales, reflecting the strong enthusiasm from our guests for our pass products, which we believe offer the best value in the ski industry. Our growth continues to be driven in large part from our more sophisticated and targeted efforts to move destination guests into our season pass products, with this segment representing more than three quarters of this year's growth.  As always, we do expect our season pass growth rates to decline through the end of our selling season, given that some of our increase is driven by our efforts to encourage guests to purchase their passes earlier in the year. Typically at this point in the year, we have sold approximately 55% to 60% of our season passes for the upcoming ski season.  The Epic Australia Pass, which replaced the Perisher Freedom Pass, went on sale on August 14, 2015.  The Epic Australia Pass offers access to Perisher during the 2016 Australian ski season (June through September) and access to our U.S. resorts for the 2016/2017 ski season.  To date, sales of the Epic Australia Pass are running 14% above sales of the Perisher Freedom Pass from the prior year."

Guidance

Commenting on guidance for fiscal 2016, Katz said, "We estimate Resort Reported EBITDA for fiscal 2016 will be between $405 million and $430 million. Our Resort Reported EBITDA guidance includes the first year of the combined Park City, now including the former Canyons terrain, and the first full year of operating results for Perisher, both of which are in line with our previously issued expectations. We expect Resort EBITDA Margin to be approximately 27.5% in fiscal 2016, using the midpoint of the guidance range.  This is an estimated 190 basis point increase over fiscal 2015, excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA.  We estimate fiscal 2016 Real Estate Reported EBITDA to be between negative $4 million and positive $2 million, which includes a reduced allocation of corporate costs as the remaining condo inventory available for sale decreases. Net Real Estate Cash Flow is expected to be between $13 million and $28 million.  Net income attributable to Vail Resorts, Inc. is expected to be between $118 million and $144 million in fiscal 2016. All of these estimates are predicted on an exchange rate of $0.71 between the Australian Dollar and U.S. Dollar."

The following table reflects the forecasted guidance range for the Company's fiscal year ending July 31, 2016, for Reported EBITDA (after stock-based compensation expense) and reconciles such Reported EBITDA guidance to net income attributable to Vail Resorts, Inc. guidance for fiscal 2016.

Fiscal 2016 Guidance

(In thousands)

For the Year Ending

July 31, 2016

Low End

Range

High End

Range

Mountain Reported EBITDA (1)

$

382,000

$

403,000

Lodging Reported EBITDA (2)

20,000

30,000

Resort Reported EBITDA (3)

405,000

430,000

Real Estate Reported EBITDA  (4)

(4,000)

2,000

Total Reported EBITDA

401,000

432,000

Depreciation and amortization

(163,000)

(157,000)

Loss on disposal of fixed assets, net

(2,500)

(500)

Change in fair value of contingent consideration (5)

Investment income, net

100

500

Interest expense

(44,000)

(41,000)

Income before provision for income taxes

191,600

234,000

Provision for income taxes

(73,700)

(90,300)

Net income

117,900

143,700

Net loss attributable to noncontrolling interests

100

300

Net income attributable to Vail Resorts, Inc.

$

118,000

$

144,000

(1) Mountain Reported EBITDA includes approximately $13 million of stock-based compensation.

(2) Lodging Reported EBITDA includes approximately $3 million of stock-based compensation.

(3) The Company provides Reported EBITDA ranges for the Mountain and Lodging segments, as well as for the two combined. The low and high end of the expected ranges provided for the Mountain and Lodging segments, while possible, do not sum to the low or high end of the Resort Reported EBITDA range provided because we do not expect or assume that we will hit the low or high end of both ranges.

(4) Real Estate Reported EBITDA includes approximately $1 million of stock-based compensation.

(5) Our guidance excludes any change in the fair value of contingent consideration which is based upon, among other things, financial projections including long-term growth rates for Park City, which such change may be material.

About Vail Resorts, Inc. (NYSE: MTN) 

Vail Resorts, Inc., through its subsidiaries, is the leading global mountain resort operator. The Company's subsidiaries operate nine world-class mountain resorts and two urban ski areas, including Vail, Beaver Creek, Breckenridge and Keystone in Colorado; Park City in Utah; Heavenly, Northstar and Kirkwood in the Lake Tahoe area of California and Nevada; Perisher in New South Wales, Australia; Afton Alps in Minnesota and Mt. Brighton in Michigan. The Company owns and/or manages a collection of casually elegant hotels under the RockResort brand, as well as the Grand Teton Lodge Company in Jackson Hole, Wyoming. Vail Resorts Development Company is the real estate planning and development subsidiary of Vail Resorts, Inc. Vail Resorts is a publicly held company traded on the New York Stock Exchange (NYSE: MTN).

Statement Concerning Non-GAAP Financial Measures 

When reporting financial results, we use the terms Reported EBITDA, Reported EBITDA excluding the non-cash gain on the Park Citylitigation settlement, Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Resort EBITDA Margin, Resort EBITDA Margin excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Net Debt, Net Real Estate Cash Flow, Lodging net revenue excluding payroll cost reimbursement, and Lodging operating expense excluding reimbursed payroll costs, which are not financial measures under accounting principles generally accepted in the United States of America ("GAAP"). We define Reported EBITDA as segment net revenue less segment operating expense plus or minus segment equity investment income or loss plus gain on litigation settlement, and for the Real Estate segment plus gain on sale of real property. For Resort, we define Resort EBITDA Margin as Resort Reported EBITDA divided by Resort net revenue. In this release, we also separately present Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA. We define Net Debt as long-term debt plus long-term debt due within one year less cash and cash equivalents. For the Real Estate segment, we define Net Real Estate Cash Flow as Real Estate Reported EBITDA, plus non-cash real estate cost of sales, non-cash stock-based compensation expense, and change in real estate deposits and recovery of previously incurred project costs less investment in real estate. For the Lodging segment, we primarily focus on Lodging net revenue excluding payroll cost reimbursement and Lodging operating expense excluding reimbursed payroll costs as the reimbursements are made based upon the costs incurred with no added margin, as such the revenue and corresponding expense have no effect on our Lodging Reported EBITDA, which we use to evaluate Lodging segment performance. Please see "Reconciliation of Non-GAAP Financial Measures" below for more information.

Vail Resorts, Inc.

Consolidated Condensed Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

Three Months Ended

July 31,

Twelve Months Ended

July 31,

2015

2014

2015

2014

Net revenue:

Mountain

$

81,061

$

53,999

$

1,104,029

$

963,573

Lodging

69,373

62,593

254,553

242,287

Real estate

11,648

18,896

41,342

48,786

Total net revenue

162,082

135,488

1,399,924

1,254,646

Segment operating expense:

Mountain

131,554

111,198

777,147

712,785

Lodging

66,470

62,217

232,877

225,563

Real estate

12,895

20,144

48,408

55,826

Total segment operating expense

210,919

193,559

1,058,432

994,174

Other operating (expense) income:

Depreciation and amortization

(37,536)

(34,653)

(149,123)

(140,601)

Gain on sale of real property

151

Gain on litigation settlement

16,400

Loss on disposal of fixed assets and other, net

(1,205)

(369)

(2,057)

(1,208)

Change in fair value of contingent consideration

(900)

(1,400)

3,650

(1,400)

(Loss) income from operations

(88,478)

(94,493)

210,513

117,263

Mountain equity investment income (loss), net

426

(20)

822

1,262

Investment income, net

91

86

246

375

Interest expense

(10,131)

(15,252)

(51,241)

(63,997)

Loss on extinguishment of debt

(11,012)

(10,831)

(11,012)

(10,831)

(Loss) income before benefit (provision) for income taxes

(109,104)

(120,510)

149,328

44,072

Benefit (provision) for income taxes

38,936

45,087

(34,718)

(15,866)

Net (loss) income

$

(70,168)

$

(75,423)

$

114,610

$

28,206

Net loss attributable to noncontrolling interests

26

68

144

272

Net (loss) income attributable to Vail Resorts, Inc.

$

(70,142)

$

(75,355)

$

114,754

$

28,478

Per share amounts:

Basic net (loss) income per share attributable to Vail Resorts, Inc.

$

(1.92)

$

(2.08)

$

3.16

$

0.79

Diluted net (loss) income per share attributable to Vail Resorts, Inc.

$

(1.92)

$

(2.08)

$

3.07

$

0.77

Cash dividends declared per share

$

0.6225

$

0.4150

$

2.0750

$

1.2450

Weighted average shares outstanding:

Basic

36,438

36,192

36,342

36,127

Diluted

36,438

36,192

37,406

37,057

Other Data:

Mountain Reported EBITDA

$

(50,067)

$

(57,219)

$

344,104

$

252,050

Lodging Reported EBITDA

$

2,903

$

376

$

21,676

$

16,724

Resort Reported EBITDA

$

(47,164)

$

(56,843)

$

365,780

$

268,774

Real Estate Reported EBITDA

$

(1,247)

$

(1,248)

$

(6,915)

$

(7,040)

Total Reported EBITDA

$

(48,411)

$

(58,091)

$

358,865

$

261,734

Mountain stock-based compensation

$

2,995

$

2,635

$

11,841

$

10,292

Lodging stock-based compensation

$

709

$

604

$

2,621

$

2,203

Resort stock-based compensation

$

3,704

$

3,239

$

14,462

$

12,495

Real Estate stock-based compensation

$

331

$

446

$

1,291

$

1,729

Total stock-based compensation

$

4,035

$

3,685

$

15,753

$

14,224

 

Vail Resorts, Inc.

Mountain Segment Operating Results

(In thousands, except ETP)

(Unaudited)

Three Months Ended

July 31,

Percentage Increase

Twelve Months Ended

July 31,

Percentage

Increase

2015

2014

(Decrease)

2015

2014

(Decrease)

Net Mountain revenue:

Lift

$

11,921

$

nm

$

536,458

$

447,271

19.9

%

Ski school

2,695

nm

126,206

109,442

15.3

%

Dining

10,349

7,523

37.6

%

101,010

89,892

12.4

%

Retail/rental

23,590

21,986

7.3

%

219,153

210,387

4.2

%

Other

32,506

24,490

32.7

%

121,202

106,581

13.7

%

Total Mountain net revenue

$

81,061

$

53,999

50.1

%

$

1,104,029

$

963,573

14.6

%

Mountain operating expense:

Labor and labor-related benefits

$

46,181

$

40,127

15.1

%

$

291,582

$

266,411

9.4

%

Retail cost of sales

11,961

11,803

1.3

%

87,817

88,291

(0.5)

%

Resort related fees

1,911

1,187

61.0

%

59,685

49,168

21.4

%

General and administrative

31,159

25,187

23.7

%

143,772

125,678

14.4

%

Other

40,342

32,894

22.6

%

194,291

183,237

6.0

%

Total Mountain operating expense

$

131,554

$

111,198

18.3

%

$

777,147

$

712,785

9.0

%

Gain on litigation settlement

%

16,400

nm

Mountain equity investment income (loss), net

426

(20)

2,230.0

%

822

1,262

(34.9)

%

Mountain Reported EBITDA

$

(50,067)

$

(57,219)

12.5

%

$

344,104

$

252,050

36.5

%

Total skier visits

277

nm

8,466

7,688

10.1

%

ETP

$

43.04

$

nm

$

63.37

$

58.18

8.9

%

 

Vail Resorts, Inc.

Lodging Operating Results

(In thousands, except ADR and RevPAR)

(Unaudited)

Three Months Ended

July 31,

Percentage

Increase

Twelve Months Ended

July 31,

Percentage

Increase

2015

2014

(Decrease)

2015

2014

(Decrease)

Lodging net revenue:

Owned hotel rooms

$

18,568

$

16,256

14.2

%

$

57,916

$

53,199

8.9

%

Managed condominium rooms

9,273

8,740

6.1

%

58,936

55,214

6.7

%

Dining

14,671

13,007

12.8

%

46,209

44,023

5.0

%

Transportation

2,575

2,517

2.3

%

23,079

22,006

4.9

%

Golf

8,535

7,768

9.9

%

16,340

15,410

6.0

%

Other

12,949

11,979

8.1

%

41,760

42,204

(1.1)

%

66,571

60,267

10.5

%

244,240

232,056

5.3

%

Payroll cost reimbursements

2,802

2,326

20.5

%

10,313

10,231

0.8

%

Total Lodging net revenue

$

69,373

$

62,593

10.8

%

$

254,553

$

242,287

5.1

%

Lodging operating expense:

Labor and labor-related benefits

$

30,385

$

28,710

5.8

%

$

110,168

$

105,504

4.4

%

General and administrative

7,379

6,471

14.0

%

32,481

30,022

8.2

%

Other

25,904

24,710

4.8

%

79,915

79,806

0.1

%

63,668

59,891

6.3

%

222,564

215,332

3.4

%

Reimbursed payroll costs

2,802

2,326

20.5

%

10,313

10,231

0.8

%

Total Lodging operating expense

$

66,470

$

62,217

6.8

%

$

232,877

$

225,563

3.2

%

Lodging Reported EBITDA

$

2,903

$

376

672.1

%

$

21,676

$

16,724

29.6

%

Owned hotel statistics:

ADR

$

201.08

$

192.29

4.6

%

$

216.76

$

205.59

5.4

%

RevPAR

$

133.77

$

118.52

12.9

%

$

140.28

$

131.04

7.1

%

Managed condominium statistics:

ADR

$

188.28

$

186.77

0.8

%

$

316.32

$

301.03

5.1

%

RevPAR

$

48.94

$

43.76

11.8

%

$

101.19

$

88.60

14.2

%

Owned hotel and managed condominium statistics (combined):

ADR

$

195.69

$

189.94

3.0

%

$

270.84

$

257.14

5.3

%

RevPAR

$

78.57

$

69.12

13.7

%

$

112.67

$

100.57

12.0

%

 

Key Balance Sheet Data

(In thousands)

(Unaudited)

As of July 31,

2015

2014

Real estate held for sale and investment

$

129,825

$

157,858

Total Vail Resorts, Inc. stockholders' equity

866,568

820,843

Long-term debt

806,676

625,600

Long-term debt due within one year

10,154

1,022

Total debt

816,830

626,622

Less: cash and cash equivalents

35,459

44,406

Net debt

$

781,371

$

582,216

Reconciliation of Non-GAAP Financial Measures

Reported EBITDA, Reported EBITDA excluding the non-cash gain on the Park City litigation settlement, Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Resort EBITDA Margin, Resort EBITDA Margin excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Net Debt, and Net Real Estate Cash Flow are not measures of financial performance under GAAP, and they might not be comparable to similarly titled measures of other companies. Reported EBITDA, Reported EBITDA excluding the non-cash gain on the Park City litigation settlement, Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Resort EBITDA Margin, Resort EBITDA Margin excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA, Net Debt, and Net Real Estate Cash Flow should not be considered in isolation or as an alternative to, or substitute for, measures of financial performance or liquidity prepared in accordance with GAAP including net income, net change in cash and cash equivalents or other financial statement data.

Reported EBITDA and Net Real Estate Cash Flow have been presented herein as measures of the Company's performance. The Company believes that Reported EBITDA is an indicative measurement of the Company's operating performance, and is similar to performance metrics generally used by investors to evaluate other companies in the resort and lodging industries. The Company primarily uses Reported EBITDA based targets in evaluating performance. For Resort, the Company defines Resort EBITDA Margin as Resort Reported EBITDA divided by Resort net revenue, which is not a measure of financial performance under GAAP, as the Company believes it is an important measurement of operating performance. In this release, the Company also separately presents Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Reported EBITDA excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA. The Company believes that Net Debt is an important measurement of liquidity as it is an indicator of the Company's ability to obtain additional capital resources for its future cash needs. Additionally, the Company believes Net Real Estate Cash Flow is important as a cash flow indicator for its Real Estate segment.

Presented below is a reconciliation of Reported EBITDA to net (loss) income attributable to Vail Resorts, Inc. calculated in accordance with GAAP for the three and twelve months ended July 31, 2015 and 2014.

(In thousands)

(Unaudited)

(In thousands)

(Unaudited)

Three Months Ended

July 31,

Twelve Months Ended

July 31,

2015

2014

2015

2014

Mountain Reported EBITDA excluding gain on litigation settlement and Perisher EBITDA

$

(58,535)

$

(57,219)

$

320,278

$

252,050

Lodging Reported EBITDA

2,903

376

21,676

16,724

Resort Reported EBITDA excluding gain on litigation settlement and Perisher EBITDA*

(55,632)

(56,843)

341,954

268,774

Gain on litigation settlement

16,400

Perisher EBITDA

8,468

7,426

Resort Reported EBITDA*

(47,164)

(56,843)

365,780

268,774

Real Estate Reported EBITDA

(1,247)

(1,248)

(6,915)

(7,040)

Total Reported EBITDA

(48,411)

(58,091)

358,865

261,734

Depreciation and amortization

(37,536)

(34,653)

(149,123)

(140,601)

Loss on disposal of fixed assets and other, net

(1,205)

(369)

(2,057)

(1,208)

Change in fair value of contingent consideration

(900)

(1,400)

3,650

(1,400)

Investment income, net

91

86

246

375

Interest expense

(10,131)

(15,252)

(51,241)

(63,997)

Loss on extinguishment of debt

(11,012)

(10,831)

(11,012)

(10,831)

(Loss) income before benefit (provision) for income taxes

(109,104)

(120,510)

149,328

44,072

Benefit (provision) for income taxes

38,936

45,087

(34,718)

(15,866)

Net (loss) income

$

(70,168)

$

(75,423)

$

114,610

$

28,206

Net loss attributable to noncontrolling interests

26

68

144

272

Net (loss) income attributable to Vail Resorts, Inc.

$

(70,142)

$

(75,355)

$

114,754

$

28,478

*

Resort represents the sum of Mountain and Lodging

The following table reconciles Net Debt to long-term debt and the calculation of Net Debt to Total Reported EBITDA for the twelve months ended July 31, 2015.

(In thousands)

(Unaudited)

As of July 31, 2015

Long-term debt

$

806,676

Long-term debt due within one year

10,154

Total debt

816,830

Less: cash and cash equivalents

35,459

Net debt

$

781,371

Net debt to Total Reported EBITDA

2.2

x

Net debt to Total Reported EBITDA, excluding the non-cash gain on the Park City litigation settlement

2.3

x

The following table reconciles Real Estate Reported EBITDA to Net Real Estate Cash Flow for the three and twelve months ended July 31, 2015 and 2014.

(In thousands)

(Unaudited)

Three Months Ended

July 31,

(In thousands)

(Unaudited) 

Twelve Months Ended 

July 31,

2015

2014

2015

2014

Real Estate Reported EBITDA

$

(1,247)

$

(1,248)

$

(6,915)

$

(7,040)

Non-cash Real Estate cost of sales

9,132

14,766

32,190

37,400

Non-cash Real Estate stock-based compensation

331

446

1,291

1,729

Change in Real Estate deposits and recovery of previously incurred project costs less investments in Real Estate

(1,291)

(2,564)

2,348

187

Net Real Estate Cash Flow

$

6,925

$

11,400

$

28,914

$

32,276

The following table reconciles Resort Net Revenue to Resort EBITDA Margin for fiscal 2015 and fiscal 2016 guidance.

(In thousands)

(Unaudited)

Twelve Months Ended

July 31, 2015

(In thousands)

(Unaudited)

Fiscal 2016 Guidance (2)

Resort net revenue (1)

$

1,358,582

$

1,520,000

Resort net revenue excluding Perisher (1)

$

1,337,345

n/a

Resort Reported EBITDA (1)

$

365,780

$

417,500

Resort Reported EBITDA (1), excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA

$

341,954

n/a

Resort EBITDA margin

26.9

%

27.5

%

Resort EBITDA margin, excluding the non-cash gain on the Park City litigation settlement and Perisher EBITDA

25.6

%

n/a

(1) Resort represents the sum of Mountain and Lodging

(2) Represents the mid-point range of Guidance

 

 

SOURCE Vail Resorts, Inc.



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