Since Tuesday, shares of mountain resort operator Vail Resorts (MTN 217.85, -1.09 -0.50%) are up about 37%. This move bucks the prevailing weakness in the stock, which began a noticeably lower trend in early November. Trading has leveled off a bit today after the company reported season-to-date total lift ticket revenues at North American mountain resorts were up 1.6% year-over-year, and gave commentary about the challenging weather conditions this season.
As mentioned, MTN’s season-to-date total lift ticket revenue at the company's North American mountain resorts, including an allocated portion of season pass revenue for each applicable period, was up 1.6% compared to the prior year season-to-date period. The reported ski season metrics are for MTN’s North American mountain resorts, adjusted as if Stowe was owned in both periods and also adjusted to eliminate the impact of foreign currency by applying current period exchange rates to the prior period for Whistler Blackcomb's results. The metrics exclude results from Perisher and their urban ski areas in both periods.
Season-to-date ski school revenue was down 4.5% and dining revenue was down 8.7% compared to the prior year season-to-date period. Retail/rental revenue for North American resort store locations was down 11.5% compared to the prior year season-to-date period.
Season-to-date total skier visits for the company's North American mountain resorts were down 10.8% compared to the prior year season-to-date period.
As far as the weather goes, management noted the 2017/2018 ski season had a very challenging start across MTN’s western U.S. resorts due to poor conditions in the early season that continued through the holiday period, reducing both local and destination visitation and spending. In November and December, snowfall season to date in Vail, Beaver Creek and Park City was the lowest level recorded in over 30 years and in Vail and Beaver Creek snowfall is over 50% lower than the next lowest season, and Tahoe's snowfall was 69% below the 20-year average.
Further management highlighted that conditions have improved at MTN’s western U.S. resorts in the last week with expanded open terrain due to recent storms, and the company expects a portion of the Back Bowls at Vail Mountain and Peak 6 at Breckenridge to open this weekend. However, the company still remains behind typical conditions for this time of year in terms of open terrain and base depth. Conditions and financial results at Whistler Blackcomb have been strong and are consistent with last year's record performance, and Stowe is off to a strong start in MTN’s first year of operating the resort.
As a result of the challenging conditions at MTN’s western U.S. resorts, the company now expects full year Resort Reported EBITDA to be modestly below the low end of the guidance range the company issued on December 7, 2017, (which was for FY18 EBITDA of $638-674 million and $646-676 million for Resorts EBITDA) assuming a continuation of the improvement in conditions that the company is currently seeing, such that their western U.S. resorts reach a normal terrain package within the next few weeks. To the extent that conditions improve more slowly, there could be further downside below the company’s guidance range.