Vail Resorts, the largest U.S. ski-resort operator, beat analysts’ earnings predictions by announcing Thursday a profit of $117 million for the quarter ending on Jan. 31, 2016. The publicly traded company earned revenue of $599 million. Revenue from lift-ticket sales went up 20.2 percent, driven by a 12.5 percent increase in visitation and a 6.8 percent increase in the effective ticket price.
The company has benefitted from its popular Epic Pass, a season-pass that allows skiers and boarders unlimited access to any of the ski areas owned by Vail Resorts, plus Arapahoe Basin. The pass initially cost $769 for the 2015-16 season. The season pass is a good value considering that the online rate for a one-day lift ticket at Vail Mountain now stands at $175. The company recently started selling the 2016-17 Epic Pass for $809, a $40 jump that amounts to about a five-percent increase.
Much of the visitation increase can be attributed to the end of a four-season drought in the Lake Tahoe area. Northstar California on the north side of the lake and Heavenly Resort on the south side have enjoyed significantly better snowfall this season. Bolstered by publicity surrounding its merger with the former Canyons resort terrain, Park City in Utah has experienced double-digit visitation growth, according to Rob Katz, Vail Resorts chief executive officer.
Along with company’s financial results, Vail Resorts described plans for improvements at Vail Mountain, Breckenridge Resort and Wilmot Mountain. At the company’s flagship Colorado resort, the Sun Up chairlift (Chair 17) in the Back Bowls of Vail Mountain will be upgraded from a fixed-grip triple to a high-speed four-passenger lift. “This upgrade will increase capacity of the lift by approximately 40 percent and reduce the ride time to four minutes in a critical area for accessing Vail Mountain’s legendary Back Bowls. With this new addition, every major chairlift on Vail Mountain will be a high-speed chairlift and this will be Vail Mountain’s ninth new chairlift in the last ten years,” said Katz.
Also in Colorado, Breckenridge visitors can expect a new 500-seat restaurant at the top of Peak 7. “This will improve the dining experience at the most-visited ski resort in the United States with a modern restaurant located adjacent to the new Peak 6 terrain, which is not currently served by a major food and beverage venue,” said Katz. The Peak 6 terrain was added to Breckenridge for the 2013-14 ski season.
Capital improvements costing $13 million are slated for newly acquired Wilmot Mountain in Wisconsin. Vail Resorts bought the ski area serving the Chicago area for about $20 million in January.
Wilmot Mountain is the latest example of the company’s strategy of purchasing smaller ski areas located near urban areas that can act as feeders to its destination resorts in the West. Afton Alps near Minneapolis and Mt. Brighton near Detroit were acquired in 2012. The idea is that skiers and boarders will purchase Epic Passes for the local areas, then use them for a trip out West.