Segment Information | 9 Months Ended |
Mar. 31, 2015 |
Segment Information [Abstract] | |
Segment Information | | | | | | | | | | | | | | | | | |
13 | Segment Information | | | | | | | | | | | | | | | |
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The Company currently manages and reports operating results through three reportable segments: Mountain, Adventure and Real Estate. The Mountain segment includes the operations of the Company’s mountain resorts and related ancillary activities. The Mountain segment earns revenue from a variety of activities, including lift revenue, lodging revenue, ski school revenue, retail and rental revenue, food and beverage revenue, and other revenue. The Adventure segment generates revenue from the sale of heli-skiing, mountaineering and hiking adventure packages, and ancillary services, such as fire suppression services, leasing, and maintenance, repair and overhaul of aircraft. The Real Estate segment includes a vacation club business, management of condominium hotel properties and real estate management, including marketing and sales activities, as well as real estate development activities. |
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Each of the Company’s reportable segments offers distinctly different products and services and requires different types of management focus. As such, these segments are managed separately. In deciding how to allocate resources and assess performance, the Company’s Chief Operating Decision Maker (“CODM”) regularly evaluates the performance of the Company's reportable segments on the basis of revenue and segment earnings, which are adjusted for certain items set forth in the reconciliation below, including interest, taxes, depreciation and amortization (“Adjusted EBITDA”). The Company also evaluates Adjusted EBITDA as a key compensation measure. The Compensation Committee of the Board of Directors determines the annual variable compensation for certain members of the management team based, in part, on Adjusted EBITDA. Adjusted EBITDA is useful when comparing the segment performance over various reporting periods because it removes from the operating results the impact of items that the Company's management believes do not reflect the core operating performance. |
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Adjusted EBITDA should not be considered an alternative to, or more meaningful than, net income (loss) or other measures of financial performance or liquidity derived in accordance with GAAP. Adjusted EBITDA may not be comparable to similarly titled measures of other companies because other entities may not calculate Adjusted EBITDA in the same manner as the Company. The Company's definition of Adjusted EBITDA is generally consistent with the definition of Consolidated EBITDA in the Credit Agreement, with exceptions related to not adjusting for recurring public company costs and foreign currency translation adjustments related to operational activities and adjusting for executive management restructuring costs. |
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The Company defines Adjusted EBITDA as net income (loss) attributable to Intrawest Resorts Holdings, Inc. before interest expense, net (excluding interest income earned from receivables related to IRCG operations), income tax benefit or expense and depreciation and amortization, further adjusted to exclude certain items, including, but not limited to: (i) impairments of goodwill, real estate and long-lived assets; (ii) gains and losses on asset dispositions; (iii) earnings and losses from equity method investments; (iv) gains and losses from remeasurement of equity method investments; (v) gains and losses on extinguishment of debt; (vi) other income or expense; (vii) earnings and losses attributable to noncontrolling interest; (viii) discontinued operations, net of tax; and (ix) other items, which include revenue and expenses of legacy and other non-core operations, restructuring charges and associated severance expenses, non-cash compensation and other items. For purposes of calculating Adjusted EBITDA, the Company also adds back to net income (loss) attributable to Intrawest Resorts Holdings, Inc., the pro rata share of Adjusted EBITDA related to equity method investments included within the segments and removes from Adjusted EBITDA the Adjusted EBITDA attributable to noncontrolling interests for entities consolidated within the segments. Asset information by segment, except for capital expenditures as shown in the table below, is not included in reports used by the CODM in monitoring of performance and, therefore, is not disclosed. |
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The following table presents consolidated revenue and net loss reconciled to Adjusted EBITDA and Adjusted EBITDA by segment (in thousands): |
| | Three Months Ended March 31, | | | Nine Months Ended March 31, | |
| | 2015 | | | 2014 | | | 2015 | | | 2014 | |
Revenue: | | | | | | | | | | | | |
Mountain | | | | | | | | | | | | |
Lift (1) | | $ | 133,550 | | | $ | 110,291 | | | $ | 173,091 | | | $ | 144,898 | |
Lodging | | | 25,065 | | | | 19,210 | | | | 48,538 | | | | 36,667 | |
Ski School (2) | | | 23,391 | | | | 20,825 | | | | 31,762 | | | | 27,950 | |
Retail and Rental | | | 30,599 | | | | 25,038 | | | | 51,796 | | | | 41,944 | |
Food and Beverage | | | 31,426 | | | | 27,469 | | | | 50,294 | | | | 42,490 | |
Other | | | 14,061 | | | | 12,251 | | | | 33,579 | | | | 30,374 | |
Total Mountain revenue | | | 258,092 | | | | 215,084 | | | | 389,060 | | | | 324,323 | |
Adventure revenue | | | 44,579 | | | | 50,376 | | | | 77,437 | | | | 84,409 | |
Real Estate revenue | | | 17,635 | | | | 18,876 | | | | 47,858 | | | | 46,047 | |
Total reportable segment revenue | | | 320,306 | | | | 284,336 | | | | 514,355 | | | | 454,779 | |
Legacy, non-core and other revenue (3) | | | 1,518 | | | | 1,516 | | | | 2,644 | | | | 13,562 | |
Total revenue | | $ | 321,824 | | | $ | 285,852 | | | $ | 516,999 | | | $ | 468,341 | |
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Net income (loss) attributable to Intrawest Resorts Holdings, Inc. | | $ | 128,694 | | | $ | 109,478 | | | $ | 46,646 | | | $ | (134,524 | ) |
Legacy and other non-core expenses, net (4) | | | 837 | | | | 1,103 | | | | 2,744 | | | | 5,342 | |
Other operating expenses (5) | | | 2,464 | | | | 4,569 | | | | 7,462 | | | | 8,070 | |
Depreciation and amortization | | | 14,767 | | | | 13,969 | | | | 44,065 | | | | 41,111 | |
(Gain) loss on disposal of assets and impairment of real estate | | | (1,083 | ) | | | 212 | | | | (1,126 | ) | | | 632 | |
Loss on remeasurement of equity method investment | | | — | | | | — | | | | 1,454 | | | | — | |
Interest income, net (6) | | | (84 | ) | | | 136 | | | | (172 | ) | | | (1,268 | ) |
Interest expense on third party debt | | | 11,742 | | | | 11,031 | | | | 33,723 | | | | 42,174 | |
Interest expense on notes payable to affiliates | | | — | | | | — | | | | — | | | | 119,858 | |
(Earnings) loss from equity method investments (7) | | | (2,452 | ) | | | (6,670 | ) | | | 305 | | | | (3,127 | ) |
Pro rata share of Adjusted EBITDA related to equity method investments (8), (9) | | | 1,386 | | | | 9,327 | | | | 3,337 | | | | 11,410 | |
Adjusted EBITDA attributable to noncontrolling interest | | | (1,420 | ) | | | (2,108 | ) | | | (1,160 | ) | | | (1,276 | ) |
Loss on extinguishment of debt | | | — | | | | — | | | | — | | | | 35,480 | |
Other expense (income), net | | | 211 | | | | (373 | ) | | | 666 | | | | 514 | |
Income tax expense (benefit) | | | 230 | | | | 77 | | | | (2,386 | ) | | | 374 | |
Income attributable to noncontrolling interest | | | 1,099 | | | | 1,514 | | | | 860 | | | | 860 | |
Total Adjusted EBITDA | | $ | 156,391 | | | $ | 142,265 | | | $ | 136,418 | | | $ | 125,630 | |
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Mountain Adjusted EBITDA (8) | | $ | 135,721 | | | $ | 119,173 | | | $ | 114,194 | | | $ | 100,027 | |
Adventure Adjusted EBITDA (10) | | | 15,449 | | | | 18,815 | | | | 12,767 | | | | 18,183 | |
Real Estate Adjusted EBITDA (11) | | | 5,221 | | | | 4,277 | | | | 9,457 | | | | 7,420 | |
Total Adjusted EBITDA | | $ | 156,391 | | | $ | 142,265 | | | $ | 136,418 | | | $ | 125,630 | |
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-1 | Lift revenue during the summer is derived from mountain biking and sightseeing lift products. | | | | | | | | | | | | | | | |
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-2 | Ski School revenue during the summer is derived from mountain bike instruction at various resorts. | | | | | | | | | | | | | | | |
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-3 | Legacy, non-core and other revenue represents legacy and other non-core operations that are not reviewed regularly by the CODM to assess performance and make decisions regarding the allocation of resources. It includes legacy real estate asset sales, non-core retail revenue and revenue from management of non-core commercial properties. Included in the nine months ended March 31, 2014 was $10.9 million of revenue from sales of non-core real estate held for development. | | | | | | | | | | | | | | | |
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-4 | Legacy and other non-core expenses, net represents revenue and expenses of legacy and other non-core operations that are not reviewed regularly by the CODM to assess performance and make decisions regarding the allocation of resources. Revenue and expenses related to legacy and other non-core operations include retail operations not located at the Company’s properties and management of non-core commercial properties owned by third parties. It also includes legacy litigation consisting of claims for damages related to alleged construction defects, purported disclosure violations in real estate sales and marketing documents, and allegations that the Company failed to construct planned amenities. | | | | | | | | | | | | | | | |
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-5 | Includes costs related to the Company's initial public offering, non-cash compensation, reduction in workforce severance, executive management restructuring costs, lease payments pursuant to the lease at Winter Park and other expenses. | | | | | | | | | | | | | | | |
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-6 | Includes interest income unrelated to IRCG financing activities. | | | | | | | | | | | | | | | |
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-7 | Represents the losses from equity method investments, including: Chateau M.T. Inc., Mammoth Hospitality Management L.L.C., the Mammoth family of resorts, and Blue Mountain prior to the Blue Mountain Acquisition. | | | | | | | | | | | | | | | |
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-8 | Includes the Company’s pro rata share of Adjusted EBITDA from its equity method investment in Blue Mountain prior to the Blue Mountain Acquisition. The pro rata share of Adjusted EBITDA represents the share of Adjusted EBITDA from the equity method investment based on the Company’s economic ownership percentage. | | | | | | | | | | | | | | | |
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-9 | Includes the Company’s pro rata share of EBITDA from its equity method investments in Mammoth Hospitality Management L.L.C. and Chateau M.T. Inc. The pro rata share of Adjusted EBITDA represents the Company’s share of Adjusted EBITDA from these equity method investments based on the Company's economic ownership percentages. | | | | | | | | | | | | | | | |
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-10 | Adventure segment Adjusted EBITDA excludes Adjusted EBITDA attributable to noncontrolling interest. | | | | | | | | | | | | | | | |
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-11 | Real Estate segment Adjusted EBITDA includes interest income earned from receivables related to the IRCG operations, in the amount of $0.9 million and $1.0 million for the three months ended March 31, 2015 and 2014, respectively, and $3.0 million and $3.4 million for the nine months ended March 31, 2015 and 2014, respectively. | | | | | | | | | | | | | | | |
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Capital Expenditures |
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The following table presents capital expenditures for our segments, reconciled to consolidated amounts for the three and nine months ended March 31, 2015 and 2014 (in thousands): |
| | Three Months Ended March 31, | | | Nine Months Ended March 31, | |
| | 2015 | | | 2014 | | | 2015 | | | 2014 | |
Capital expenditures: | | | | | | | | | | | | |
Mountain | | $ | 1,696 | | | $ | 2,412 | | | $ | 27,687 | | | $ | 26,714 | |
Adventure | | | 645 | | | | 369 | | | | 3,419 | | | | 6,892 | |
Real Estate | | | 18 | | | | 20 | | | | 245 | | | | 564 | |
Total segment capital expenditures | | | 2,359 | | | | 2,801 | | | | 31,351 | | | | 34,170 | |
Corporate and other | | | 471 | | | | 1,218 | | | | 3,170 | | | | 2,759 | |
Total capital expenditures | | $ | 2,830 | | | $ | 4,019 | | | $ | 34,521 | | | $ | 36,929 | |
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Geographic Data |
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The Company’s revenue by geographic region for the three and nine months ended March 31, 2015 and 2014 consisted of the following (in thousands): |
| | Three Months Ended March 31, | | | Nine Months Ended March 31, | |
| | 2015 | | | 2014 | | | 2015 | | | 2014 | |
Revenue: | | | | | | | | | | | | |
United States | | $ | 201,516 | | | $ | 189,543 | | | $ | 313,838 | | | $ | 296,613 | |
Canada | | | 120,308 | | | | 96,309 | | | | 203,161 | | | | 171,728 | |
Total revenue | | $ | 321,824 | | | $ | 285,852 | | | $ | 516,999 | | | $ | 468,341 | |