With more than 12 feet of early-season snow, a steadily rising stock price and enthusiastic analysts’ reports, Vail Resorts Inc. finds itself with much to boast about.
Later this month it will add one more distinction: the nation’s priciest lift ticket. Vail and Beaver Creek will soon start selling full-price, single-day lift tickets for $81, up 5.2 percent, or $4, over last winter’s price.
“There is a certain bragging right that comes with charging the highest lift ticket price in the country,” Vail Resorts chief executive Adam Aron said. “It’s just another way of saying how good the Vail and Beaver Creek ski experience is.”
In a conference call with analysts Wednesday, Aron discussed results of the company’s first fiscal quarter – a net loss of $34.3 million, up $2.8 million from the same period last year – but also did some boasting.
Vail Resorts ran a full-page ad in Wednesday’s Wall Street Journal that read, “Snowfall: The reasons to be here are piling up at a record-breaking pace.”
Aron later explained, “I want every skier out there staring at that ad and salivating.” A second ad will run in USA Today either today or tomorrow.
He also pointed to early indicators of a strong ski season on Vail’s four Colorado mountains (Vail, Beaver Creek, Breckenridge and Keystone), and its Heavenly resort in California:
Record season-pass sales of more than $50 million, up 7 percent over last season;
Solid advance bookings, up 2 percent at Vail’s central reservations system;
Advance airline bookings into the Eagle County Airport, up 5 percent over last year.
“We’re less than a month into the 2005-2006 ski season … but we could not be more excited with the momentum we have built and the buzz we hope to continue to create,” Aron said.
Investors and analysts seemed to agree. Vail Resorts’ stock price has been climbing steadily in recent weeks, increasing 24.5 percent in the past two months. It closed at $37.47 on Wednesday, up 21 cents.
Last month, Bank of America’s equity research division initiated coverage of the company, rating its stock a “buy” and setting a 12-month target price of $42. In a research report, analyst Eric Brown said he believes Vail Resorts’ real estate assets are undervalued.
“We have forecast that new real-estate initiatives at Vail Mountain should provide a significant contribution to Vail Resorts’ net revenue” in upcoming years, he wrote.
Bank of America also handled the recent sale of 1.78 million Vail Resorts shares by its largest shareholder, Ralcorp Holdings Inc., to an undisclosed buyer.
For the quarter ending Oct. 31, Vail Resorts’ total revenue was $85.4 million, down $12.5 million compared with last year.
The company blamed the decline on decreased real estate revenue and increased charges due to an accounting change on stock-based compensation expenses.
Vail Resorts’ performance for the quarter beat analyst expectations. Earnings are traditionally low for ski resorts in August, September and October.
Staff writer Julie Dunn can be reached at 303-820-1592 or at jdunn@denverpost.com.
