Vail Resorts’ (MTN) CEO Rob Katz on Q3 2016 Results
Pass sales units up 29%
Pass sales through May 31, 2016 for the upcoming 2016/2017 U.S. ski season increased approximately 29% in units and approximately 34% in sales dollars as compared to the prior year period through June 2, 2015.
We get more intelligent every year
we are continuing to improve the way we target and segment and communicate to our guests and that gets more sophisticated, more — we’re just more intelligent every year as we learn more from the previous year and I think you’re seeing the combination of all that drive significant growth.
International sales solid but still impacted by dollar
International pass sales are totally solid, they are fine. We aren’t seeing anything concerning there. But, I would say we’re still very early to really understand the visitation dynamics for next year. I do think if you look backwards a year, the currency had really been — the U.S. dollar had been strengthening quite a bit in the whole run up to that season and it has appears to have stabilized a bit if not come down a little bit from where those ratios kind of bottomed out or peaked out or however you want to look at it. But, I do think that some of this will depend upon how the currencies move over the next couple of months. I think we may have a better sense of it in September certainly than in December but at this point, we aren’t seeing too many concerns. I think if anything, we think certainly we have some upside potential because we’ll be comping more challenging results from last year, but obviously there is external factors that will play into exactly how much upside we can actually generate.
We want to acquire where it makes an impact to the network overall
we don’t just want to acquire to acquire, we want to acquire resorts certainly where we think we can improve them, but much more importantly than that where we think that resort is very impactful had to our overall network.
Indications that summer travel will be robust
feel very, very positive in terms of overall summer visitation certainly, I think there’s a lot of indications that summer travel particularly car travel is going to be robust. We’re seeing a very strong visitation in the national park. I would imagine that will be true certainly for us in Grant Teton; I think that will be true in Rocky Mountain national park in Colorado as well. I have no doubt that will be true in Lake Tahoe. So, I think certainly summer visitation and summer tourism travel I think is in a good spot which bodes well for us.
Recruiting and retaining people is key
would say we think that given the strength of the economy and the strength of the economy and markets in our particular resorts, we think that retaining and recruiting talent and people in general all across our entire all of our properties is one of our most important priorities. I think labor costs this past year absolutely grew and were higher than if you looked at the previous year because we took on a number of initiatives in so many different area of our company whether it was wage, changes or bonuses to help incent and ensure that we feel like we are competitively paying all of our employees. And we absolutely assume that will continue for next year and that’s factored into our business plans and something that is really top of mind for us to make sure that we can continue to deliver the experience that we need to for our guests.
Thanks, Rob and good morning, everyone.
For the third quarter, resort net revenue was $645.7 million up 13.9% from the prior year period and resort reported EBITDA was $306.6 million an increase of 14.7% over the prior year period. These increases were driven by strong visitation and robust guest spending on lift products as well as in our ancillary businesses across all of our western resorts.