MTN - Earnings call transcript Q4 2020

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Operator

Good day and welcome to the Vail Resort Fourth Quarter Fiscal 2020 Earnings Call. Today’s conference is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to CEO, Rob Katz. Please go ahead, sir.

Rob Katz

Thank you. everyone. afternoon, Good fiscal our earnings call. conference Welcome XXXX to year-end

this Michael Barkin, Joining me Chief is call the on our afternoon Financial Officer.

let call filings future materially. statements and uncertainties Before provided and subject to certain actual begin, me described of that are you we risks number some assumptions during and this vary are in may results that forward-looking as may a include based on remind information our SEC

which on this statements we along remarks include along Forward-looking our on The measures update filed measures. our afternoon with today events of XX-K of also the issued report press undertake these actual this with non-GAAP were provided Today's at unfold. Form section to Relations of on and the are afternoon this our also tables available are call website are September in release duty release www.vailresorts.com. them XXXX SEC included as as financial certain remarks Investor and with made the annual reconciliations press in with our XX, no our

fourth said, So and fiscal XXXX results. to our that let's turn with quarter

mountain XXXX, results and beginning for full year were destination the resulting our resort ski negatively regional Our the a XX, guests, closure decision of of for we on North safety American by March COVID-XX areas our and communities. impacted the and resorts made employees,

holders the renewal negatively as pass North by the pass impacted XXXX to pass for was credits of the approximately year to Reported season. and revenue for to product of holder EBITDA related $XXX result encourage XXXX-XXXX XXXX-XXXX of In million addition, deferred American Resort a offered fiscal deferral costs

notes, our costs, reductions plan year, million, and calendar a the $XX a executing throughout for and to significant to of of raising the reducing XXXX unsecured $XX million implemented closures million we savings expenses. quarter, through reduce $XXX enhance senior of number and our issuance for resort remainder by of operating year dividend our per in $XX suspending actions cash over the the million capital approximately our liquidity including Following

Our the throughout reduced U.S. driven time quarter. the million demand for overhead well the expenses, seasonal due to compared border $XXX as increasing period, with Reported Resort and snowfall, disruptions. travelers COVID-XX, demand reductions terrain to cost-saving our and of At fourth government we July July Perisher season EBITDA North impacted as XXXX, Australian July, Hotham guests liquidity Victorian $XXX over the throughout Resort a Blackcomb, We expectations part negatively restrictions, and prior from year, XXXX. guest continued X, issuance and, following on limited our July. In experienced guests, opening in closed results stay-at-home by on June from late be COVID-XX-related X, In decided month to including in on negatively by majority U.S. and rigorous subsequently and the our American a the on the Falls combination ski Australia, At Creek and international declined and was leisure impacted a below net resulting fourth XXXX, summer and operations by significant labor of in million July quarter the result, resort for opened America, for as the travel Perisher, North revenue until of by to orders demand of July poor our early quarter operations declined June cost Canadian with to by limited Falls net X, communities the negatively Hotham were XX, close impacted while cost actions. million $XX same July. the XXXX, group not controls portion maintained capacity in reflecting with Creek of Whistler

communities to of upcoming for operating current they at plans travelers. believe we the US with outdoor experiences, our saw this our resort pleased We travelers the summer leisure for and, familiar the locations drive our are the visitation speaks with many, option American Turning preference resorts. to season. ski to from North were for We this to

As committed lifts we is American as North and soon of ski terrain with on-mountain much our as approach historical experience as consistent XXXX/XXXX as providing season, the possible. comprehensive many practice a are we to that opening

prioritizing of we focused XXXX, season, and believe safety XX, We our guest employees, safely North operating American guests other will plan reservation to the XX our announced system lift on enable our that our us and gives limitations changes health be dining a limitations and that holders, On of operations. to including ski preference our across will sales, August guests, the implementation consistently operate also experience resorts the on resort facilities, we while communities. and pass an the our ticket on throughout to for

related to new the will financial be impacts will uncertainty successful any but XXXX our to may experience based operations which our and from at and negatively and changes plans regarding fully operating difficult we positive our the season COVID-XX. results. or operational visitation impact our information safe required to resorts on may continued capacity is ultimate and a enable negative plans, We given fiscal help potential time to ski assess also It impact financial expect this these

pass sales. our season Turning to now XXXX/XXXX

Epic Given are season the XXXX sales upcoming XX, circumstances increased the date. challenging our results September pass North to the very Season XXXX/XXXX the pass XX% of American season of upcoming sales for passes approximately provided of redeemed a American in September last Pass for approximately through impacts dollars, pleased We surrounding compares we season increased the prior XXXX. Epic ski through the American to the through and with compared approximately XX, which for Pass this sales sold value and XXXX, the sold value dollars with for for Through sales commitment best year sales North X.XX year products. North credits credits, approximately advanced value million deducting the skiers of X, to December North season, all September committed XXXX/XXXX we the year. approximately through year ski holders. decreased reduced of Day total Without the our to by prior dollars pass for redeemed compared as have and remain providing period the units the XX, COVID-XX, to in American riders to in passes total XX% the X% XXX,XXX

success pass benefiting credits California, was XXXX, Utah, to-date continued year. first additional in past move at Northern the Mountain pleased very momentum make deferral of of experience holders million. available pass of we a As from their purchase presented pass September pass substantial XX% current by offer solid decision, products fiscal Through pass $XXX renewing from a sales saw to up believe growth the holders have year, renewals lower and the total are our those the the for XX% provided time last The $XXX operating our of to COVID-XX, in for we our to of excess resorts previously driver XXXX/XXXX we the to pass strength to saw deadline, growth Colorado, holder introduction holders, a for of from our our Total of holders, many fiscal the the saw challenges in minimum pass XXXX We of and to Northeast travel from our season with an guests revenue amount credits resorts clearly deferred from markets, introduction and Rewards, approximately the new in XXXX it circumstances. credits for demonstrate fiscal represent incent Coverage, to pass XXXX/XXXX growth renewal, guests comparison primary of destination of base renewed the markets. offered million deadline to holders, loyalty pass for and aggregate to Epic drove believe the season is the unit of utilizing unit peak purchase portion while used offered season from pass sales full-year guests. our in to we disclosed, see the results this such last We despite maximum but as our the the than network. of made of units our into earlier commitment our XXXX. renewing Whistler which year a our the particular guest ranging our We season and the revenue of program our of of Epic total Epic XX, Day also multi-day through importantly, given season in September XX% encouraging Pass, the and to through of no million guests deadline our we the were minimum our we markets credits with safety pass Most our unit $XXX plans guests. strong with XXXX/XXXX demonstrating September to

get season final our finish lower unit if increase total with for or due or who personal we COVID-XX. September credits. from will Epic XXXX we renewal the reservations, declines is the sales suffer expect we've claim of deadline in our sales guests XX, uncertainty be the to expect year December related an through enter at and the year. given period qualifying And based impact that close to events our pass ski or in unit period remember around strong pass final in season. for one revenue The in we expiration of deadline, see upcoming we holders than pass As sales, last do comparable unit their And of XXXX, important or not an its growth will our continued sales primarily travel refunds we or in very resorts last holders Coverage decline driven full XXXX this rate on to the the and more other new to to preferred be holders September partial will year's foundation the by injury COVID-XX on period sales, forward potential as who expected sales the setting is market. XX, renewals of It such the of a expanded pull pass drive priority to

unprocessed pass not XXXX-XXXX. online pending purchase such include season transactions forms guests include submitted not approximately be Our reported using in from do that the guest a with around credit price that a growth the as XX,XXX associated pass to from lower transactions what processed deadline had rates online, could

exchange translate we requested forms reported unprocessed a been an rate online expectations sales are pass have rates these Pass we will increase of for the X,XXX from sales. Canadian redemptions Whistler for $X.XX deferred the eliminate we the sales both Collectively, yet pass mentioned pass received are impact not in growth of pass estimate between an to forms their program Blackcomb complete of The revenue could amount reflected the of of dollar pass of in applying transactions US pass purchase how year will to and season growth adjusted are reporting the periods full during are Estimates amount currency approximately the pending foreign these and is above. results as XXXX. earlier in an dollar differ fiscal recognized credit included transactions. processed XXXX-XXXX holder the revenue of not actual and refunds requesting by which we have rates. deferral Additionally, our

the Now, would turn to discuss XXXX outlook. to and call over further I liquidity results, to our Michael fiscal financial like

Michael Barkin

Thanks, Rob, and everyone. afternoon, good

year in $X.XX Vail diluted Resort resulting for our or share fiscal mountain to compared reported prior negative year, attributable million As net year $XX.X Resorts year. in for of of partially primarily COVID-XX, or the $XXX.X Reported XXXX, a fiscal for COVID-XX of EBITDA $XXX.X mentioned, EBITDA American the per $X.XX compared fiscal significantly year fiscal Rob cost fiscal and were share implemented. the income income result Resorts of prior results million million offset the North by to million was to impacted by Net the the $XXX.X XXXX diluted resorts. actions of the closure impacts per as our was

under million revolver under the of with $XXX $XXX total of US on position availability Our Agreement of of of revolver million hand, the with and liquidity Whistler Vail cash $XXX $XXX million revolver Holdings August remained Agreement. and approximately Credit XXXX million cash strong availability Credit availability XX, as

of net our As debt trailing XX EBITDA. July XXXX, X.X was times months XX, reported total

May Holdings a down of pay due on in senior we X.XX% under an to amount principal utilized of XXXX, our Agreement $XXX was million X, in balance of offering its U.S. outstanding disclosed unsecured previously of Vail As completed revolver the portion the notes XXXX, which entirety. aggregate Credit

each the to XX, prior complying XXXX, XXXX XXXX, we covenants ending of with Agreement, Holdings make we on Additionally, the unless to agreements onetime July providing an the a exemption from terminate exempt January into date. such we entered April other irrevocable among will such fiscal election be terms XX, maintenance Credit amendment for to financial that through XX, Vail quarters period

fund ski least continue We of resort expect to event liquidity season, shutdowns. to through extended at in to even have operations sufficient the the XXXX-XXXX

guidance to for our environment. current our and fiscal season time. our resorts, are Moving may now evolving fiscal will challenge economy travel the COVID-XX outlook, full-year the at the dynamics, provide with the in results capacity guests with the assessment very we this given specifically to demand and the the demand, providing our company XXXX visitation and has the and commitment that to of that resorts said, indication loyalty With not uncertainty of the created to-date on pass across even of and our XXXX sales be our pleased for ultimate

guests of season do result we traditionally broader to associated lift dynamics stronger in and revenue from declines our do for primarily a declines to resorts expect relative visitation material to relative in resorts. drive-to expectations the than local this visitation in as the expect fiscal we fiscal who declines XXXX, industry, our a visitation see guests original visitation Given purchases. expected and travel our basis, On to XXXX fly from ticket non-pass in

from We and guests and new infrequent riders. stronger skiers visitation repeat also expect guests versus

We more challenging of visits significant travel, in which impact XX% come where typically Whistler at Blackcomb international approximately have a expect particularly from Canada. of outside declines will

negatively lines capacity to of our guests. rely on ski to and including constraints rental declines our more beverage destination impact food dining outsized beverage, school our to on tend and business, material and expected for be retail visitation, the ancillary impacted also expect we Given is operations. that heavily by destination Food expected

We efficiently management are cost business. operate focused on the to disciplined

we guest a experience, historical North mentioned, lift and conditions all with to plan terrain resorts footprint, maximize in practices on-mountain our comprehensive loyalty ensure with full previously the guests. and our and our order to holders of of ticket permitting, operate to in invest As to capacity consistent American a long-term pass

cost million XXXX. However, given but implementation we cost our basis manage to for limited an compared year, our the to our actively expense annualized lower of for the reductions to original not expected visitation as continued and totaling structure, $XX revenue on upcoming fiscal including operating have expectations over

materially with and the in from levels We where actively resulting it experience, XXXX. our be expected short impact fiscal with managing in guest the also are these efforts savings term business the of expenses to aligns our does not realized first quarter

to expects company expenses, season. into renewal with declines of in that to offseason of that expenses year, In XXXX, in XXXX. every Coverage address original expenses expenses estimated claims addition, transaction fiscal representing experienced $XX Epic million deferred a this reduction premiums EBITDA a In and to those our relative price Resort of decline integration-related on high will incremental million $X level service have $XX COVID-related inclusion from fiscal million in relative midpoint approximate in Resort the will XXXX to an from provided XXXX/XXXX X, based of million reduce including the XXXX additional on impact from Resort Reported headwinds any the changes, pass fiscal and of credits there our and the percentage range are XXXX, guest EBITDA September the fixed XX, losses approximately fiscal be approach to August a $X avoidance in prior The large revenue our an coverage administrative business for fiscal operations, those of cost. injury Peak closing acquisition XXXX margins. for nature result million year our on Reported more estimated the Even approach as unique EBITDA material estimated would the to Reported losses Resorts XXXX impact XX, operational in from an of our of efficient the September paid, creates our associated of an the of and product a to also the personal and EBITDA $XX September any in elimination incur XXXX claims and XXXX estimated XX, guidance

increases to fiscal a expect revenue declined for in guidance fiscal guidance we an uncertainty economy $XXX $X.X As reasonable to has our travel from relative COVID-XX by given Resort for Reported provided significant time, operational Resort an fiscal this XXXX, approximately We created XX% across expect that example, in challenge the for EBITDA of demand, to Resort and our Reported for net our or and fiscal or of example change would would illustrative this for would the if Full-year to result in ability within approximately to XXXX Resort revenue XXXX decreases XX% XXXX. net resorts. revenue revenue, billion, the at predict range, our EBITDA approximately the of original visitation million. decrease increase constraints

We to additional an will and over turn as pass Rob. back gain now view on an clarity updated sales provide in we on December call update demand capacity. I'll and to the look

Rob Katz

Michael. Thanks

communicate the provide to and continue strong built that of season prospects our products to our of with be pass our We lineup we guests. long-term access in data-driven world-class the our marketing on of business the guests, of confident approach resorts network and sophisticated irreplaceable model loyalty that is attract use the to

resorts through COVID-XX. to guest Our the the strong in capitalization while manage positions circumstances flexible evolving and experience caused invest remaining us by people, our to our to continue

Operator, season. upcoming we head for exceptional we know our are shown prepare crisis. an be be questions. this to forward for could At guests I not happy looking questions. for committed are during Michael as As time, are passionate, who and now they grateful to would this more ski employees, experience answer how ready your providing We we season, into proud we have up the we this our of to

Operator

our We question Instructions] [Operator take from Barclays. will of Hendrix first Felicia

Felicia Hendrix

I COVID obvious a has is talk definitely obscured That about underlying seeing Rob, So, Peak fundamentals. the comment, but strength your Northeast regarding an acquisition. in given the this said, you mean, lot did

Epic could should if converted see Resorts talk the many Resorts, season. you in holders also decline how you're expect having wondering to Peak a example just So drag clearly about more bit resorts Peak to mitigate maybe pass have for help to what seeing incremental from you this Destination and

in is us give can Peak helpful? you Thanks. that be data any terms things how of would So driving

Rob Katz

number important is I think outside Destination one, our Yes. that well. most I'd what's Northeast Sure. again, guess the including perform in Peak definitely maybe of I strongest very And say segment. was our markets total markets or

that of I on Destination was years certainly absolutely markets category, that And I kind I a Northeast the think within had outside started was the we've our performer. continuing Peak acquisitions again it's question is drive-to the way where all top to even of that, think - think something that couple that. a was with once back have within option. we helping also But now build the in I think Stowe. of

of our many of products strongest. some are our Epic think I core

quite option perfect this at for what having a people's because drive-to right great so was Peak a of focused big heartening provides us us definitely also all that product access it I think, positive And opportunity, buying that but And to yes, option think or a to I is the is have I was to everybody on think a a people isn't think opportunity our time that And in necessarily necessarily this is resorts. purchase I second looking minds. in now nice terms of still to. to clearly,

Peak look I markets. details seeing season to So specific strong But Destination of end until provide absolutely honestly say the Resorts, providing and performance we extra selling the just anyway. over when bump, to tough absolutely on broadly across get do yes, that would the that an our can't bump a we probably I from

Felicia Hendrix

So to surpass internal did Epic, did expectations? Peak the conversion your that of

Rob Katz

yes. Yes. I would broadly say

I year. results the probably think a I resorts, some year is the had last interest to - have I at and think that and in see think think an again phenomenon we're driving this when strong at all strength. think And I started that point we've again, the I - year Northeast have we right? - seeing starting One is that obviously we people the those market that three in highlight think success we this factors broad of So saw success. this as is I we're converting last destination who well,

compound, and providing second is years options, three Northeast that this people past just to The in the absolutely or four these Peak we've then more year. had

Felicia Hendrix

sold that, a there's by about pass, passes versus it And basis the can seeing then of mix the we what remarks but you're that just part pull year's normalized a percent seeing your data just or just the Thanks. of you season for you maybe pass time? your in year, traditional like a versus XX% prepared the about now as follow-up, of that, what know so what Great. the did passes sold trade-up are in understanding just as last looked can my sales, it on units. looks selling that and second of of We have the give pass press of season, talk like Epic implications, sales And said day on might then usually follow-up you like this season you are in a of forward, just have and release a kind trade-down? this

Rob Katz

we've full I gives I the that. selling put necessarily out would the of say overall the play estimates say comment I that the rest on results we're I this that's - right, giving that how question, into year think somewhat year, likely out so on second a But - is to not think, the So what feel not sense, that of yes, stat, this you of would the think, we I by season. triangulating that the kind for have for - out we put can't I

I the pass very give local say point, I this and I really can't Epic that strength of of of think very terms in we're the any that would at kind don't say get products. exact - possible on once online XX,XXX would of we forms season is it's with the kind through commentary what we Epic that that downgrades because pleased mix, shift. would knowing and even of downgrade, we in, a this Epic say able haven't But at in of the were surpassed Epic has absolutely go our mix haven't what's Local back which many forms they been we're the fully without those I processed for could we, guest to sent to point, and again yet, performance been expectations. because

Operator

next of We take Bank will now our question the America. Shaun of from Kelley

Shaun Kelley

clarifications, have it's Just one I lot in color. couple quick guess, appreciate digest a there's given. is lot here of start, clearly two a the really than usually to or I all know more to a I and additional

the range question So, the kind gave, of that for thank on My Michael, is sensitivity. illustrative you that. first you in

that year. Just this. Am range thinking from that super from I excludes last on carryover to about deferred the That be clear from both revenue sales impact passes right? the and

Michael Barkin

guidance be versus the would basis. numbers for a on would on That XXXX year's reported what illustrative basis last be

that include impact adjustment of XXXX in for credits to last no guidance and the the the So, would year.

Shaun Kelley

Okay.

it So, does include…

Michael Barkin

to try if like adjustment you for not example, that that will. a did We do in same-store

Shaun Kelley

Okay.

Michael Barkin

the For credit.

Shaun Kelley

the also the times Rob, which a a hit is So, about of delayed a or little downgrades you technical. second forms. on of bit question, it But XX,XXX couple

to different way would a products, mix these are the But a be kind directionally Is - not should to included that about in have to unit be that the some orders, But about been to think additive or precise these or we are may from the about units? effectively perspective, yet point guess that? at units more they be the counted, how we or on might should they are as think think still right base for that there still be refund. X,XXX be so but Just I Yes, of it? excluding guess lower that, price those these shift. a might be what unit I

Rob Katz

think frame forms, really, short could mean a had entire that say epic say provide with day I local I for just to I the so build and So, given these I - essentially a the and let's from their downgrade we process. we is, to pathway what online think four all online not an an epic to would time unfortunately local past, epic or their use way couldn't credit We an to people credit. an epic provide

process process or they just people this we've And numbers what their center call got. the And able call card back Actually, forum the have that to we use kind guest online so, the in these to need been given and told we to their forums get to still we gas, do, credit include to but them. circle to of wants it. actually have

they wanting actually that until will processing given they strength come for But I our the through translate every more not likely, day, this to downgrading. so credit epic year, I it that form. and a going with of can't on a requests point, have we we to could really right, have a is go people would we meaningful out. past one they with of we're but refunds. highlight include this them, downgrade upgrading to are sure it do year to exactly say putting will XXX% thing along out number, process could going because continuum. but refunds. that same what it to And at can't it's you sales to there And number do that that how that. things us we But We've we So, surprising significant the these precise the think again, be true those And - include epic people we a forms to is include just certainly into. an somebody from would of see an past can’t to got be say actually

Shaun Kelley

But right? the XX,XXX in included just So… be clear, is the to right, not XXX,XXX

Rob Katz

Correct.

Shaun Kelley

- no a be It unit. like …even incorporated processed. hasn't just I'm unit there's would been that And downgrading, if there's today.

Rob Katz

Correct.

we we that of forms. the - includes with the So, the growth rates forms none that XX,XXX of X,XXX announced, XXX,XXX, anything

Shaun Kelley

be with to terms I amount of this and the your some - experience then actual operating but I bigger-picture going Perisher now question. sort constraints of at the is guess, tough, the bit little And of maybe Australia. capacity know in in a is you have this performance,

you sense this constraints even would an more you some normal higher extraordinarily Like capacity saw us normally and component, color how on if does mountain this an directional just was reservation course just any that up because give season. you're give some go probably maybe it's could move volumes that's impact feature, than expect an that probably advanced of you like illustrative any that’s booking in to So, that of of you people about the to environment to the you lift what where for have? could what coming impact we when

Rob Katz

Yes.

is important to that So, snowfall very is Australia, One, what very, Australia record-low limited I things. terrain. that I'd remember actually about and one two had say think it’s

from gave say I for a that gave us, - But moments. kind what the lot first example so, a gives I And especially of the things I normal operating. of that. was know into those of would half think of of the in us the really we is it for away critical experience one of type don't that a season, insight it And took an system us was that reservation

better say think the as of to overall, went that how I no allow level is better for capacity. I able better terms America performance - performance doubt much, taken, greater much of performance we year at to hone we allocate season impact, - and much I what right, There's us North saw better were [indiscernible] this that the financially, biggest insights on, that believe capacity. in think operating we would the a lift to the we've actually plan sophistication. in

fully could that extent down brought loading we our that capacity that is mountain of lose, not some the be that to so just lift, And capacity. we're than

that of upload of the of experience Some right for any the could not a bad making capacity guest be we're at creating that safety start or people issue. day sure and kind

impacted that the as - days, by is think about I tend constraints truth say peak those very of some could think we the know, would impacts to to we most And so right most the that. though many season that be be we would capacity of capacity likely there have. they’re even not you

we'll do potentially F&B we year. I see constraint capacity food revenue capacity think on get we're for going F&B guidance is be a absolutely somewhat regulations, very absolutely we this mountain. terms is much a to to a percent the related lift, of what in constraints, the that limiter for we our the we that on not in the a necessarily of terms in restaurant have buying capacity the also of of both terms limiter in mountain. - people less another absolute of we and in Shaun? And good, it of that a we terms of number overall put coming But have that an people will in restaurants, both to to obviously, some will capacity that's demand limiter what of or number. visitation and And people the those from think less terms think Beyond subject local can Is right. But

Operator

next our Deutsche We Chris question Bank. will of take from

Chris Woronka

willing wanted window? making be hotel think I how relevant you those but booking this to also out with that are some think shorter how any points now reservations today, year about, historically you data they share Colorado mean - right there given you've of points seems data ask on relevant to given are us time a the I resorts. you do in sometimes I of to of decision

Rob Katz

at We Yes. think don't relevant this they're point. very

best think recession. clearly, in typically coming in think out early we cycle this the even And of years. the I XXXX/XXXX this the I is pretty and saw

to see I window a that they people reservation get will to mountain. obviously, shrink quite telling obviously today. bit. to going The we going on think And the it need is a are booking we're

And to we like early we're feel going probably the put reservation our November. out interest in booking not after see so, more system substantial we until

booking So, we're focus would on data these say putting points. not much too I early

Chris Woronka

have place And mean last it's wanted system us it turn Is how pretty to season, would is small possible but in had then you into you season? upcoming I ask. days back people with away? can number, the to that of been share a in reservation for the that's kind given had many I to place assume

Rob Katz

- precision that. to around We really give tough Yes. it's

majority on issue. like publicly put feel do an believe the So I season they'll pass for and the that we it won't that year days we be be holders, of vast there certainly the able mountain out we've think during our absolutely to access

daily I we have release limit as ticket that the material of in a down. see impulse we think purchases, made that's go we as think more terms to it's do in those - will at that clear lift that decline this point lift I purchases, and potentially sales think I we ticket unknown, and in purchases think

some of our of ultimately other sales, On pass on the of for our that could right, pass sales selling hand, the season. remainder help obviously some

how very see exactly to us But, to days of other say that, say for year about frequent. handful and resort, last throughout that each yes, this than see yes, we to need So put we very I a we're more out be plays we'll we talking year may out. normal have weather versus if the that restrictions the year assuming difficult just poor there. to managing for conditions, have again Obviously, capacity think conditions, then

Chris Woronka

mean, of just there people how a housekeeping do the How request it? system, question, request refund. kind reservation that? that? for mean, mechanics I they do are for a mechanics work? what how who mentioned you Who's - does later be the with I And behind that eligible could work the

Rob Katz

Yes.

don't, - to be they number purchase period, system, at season want can so any and product. people someday get the able or - at back somehow will their open end the seven up which and saying maximum period to whole product is they that days reservation So that can't what is, come come reservation the refund they of If want. get that ends reservation we and on doesn't that'll have the priority a it, priority they people our to our And happen days, in of they the the go holders, and they to have capacity obviously if for really for the and that of for reservation is to ask And seven. us days pass beginning when we're they of December.

have would our earnings on we sales pass know, a but probably going good of call final sense reporting pretty that not you into So, XXX%.

Operator

now from take question Katz Jefferies. our next will We David of

David Katz

the detail copious the usual for Thank and transparency. you

Rob Katz

Thanks.

David Katz

to carryover I - flows of were $XXX further, impact to net go to just much we model at you provided higher back I one, you adding, want illustrate which deferred to illustrative what of of said right. Number pass line? through top excludes to to revenues, does that a there, on that the revenue I have think, hypothetically what's any right, do EBITDA the think, Michael, the you million level, What… If

Michael Barkin

the for So, David, deferred reference - I disclosures. credits guidance I is we're clarify original to prior revenue want the in a that the we’ve XXXX XXXX. All yes, as to illustrative in recognized assumes is our just want providing just from point doing to model the outlined

David Katz

Right.

the $XXX So, is… million

Michael Barkin

deferred The assumption XXXX example being includes this an illustrative of year. revenue the recognized

David Katz

be level a margin would Right. in And flows revenue assume high it very there through that raises that fair fair to the Is deferred that a otherwise? impression? and that is at

Michael Barkin

with mirrors, the right, because past largely the would we sales a revenue issue. Because are onetime revenue largely recognize right, in Yes. year, any credits the deferred

financial normal, the question a a that a revenue essentially was right, because right, of on from really we largely perspective profile grossing that our it's it's up cash is it normal, business statement the when perspective, to received. But mirrors levels. - pricing So, for

David Katz

many second Just if is or sense to out, operating normal is have been with to I away may a those fair the hypothetical under apply we to it a of… my you've model? operating question, a model turned year that say, last year, how that this to, question if ask were visitors may, circumstances laid And get

Michael Barkin

No.

David Katz

of kind impact? …that

Michael Barkin

Rob's to the capacity on precision really more kind any provide can't point, this at comment, of think prior we side. I

I to is starting a around or fixed year then variable, - a be cost there the providing with adjust think the point by you and example both illustrative perspective assumptions. of do revenue road yes, we're the on people And you based structure that but specificity give declines largely our give map we're visitation really - trying what not with sense will revenue and to on that. - can providing any providing that material this certainly your then our of

David Katz

right. All

Michael Barkin

I that mean, to demand, being driven by I would is demand driven example constraints. onto just being the by really capacity not consumer illustrative say add that

impacts But in we - really script, we in that's said the than he earlier going hard this factored of to other where have obviously as be year. are release clear that for a So of the understanding F&B, quantify because pretty be. to capacity that to the what is it's what going

this - of exclude it's at on whether course, similar how demand, that you illustrative capacity you we that people model, So look that's no point, driven of know at revenue when demand, said obviously or limitations really because loss. there's it's

Operator

from question Scholes next our take will We of Truist. Patrick

Patrick Scholes

think into will a of potential - this of year? be My international into logistical going the that, questions specifically and potential related employee’s you the capacity challenges that concern winter the much staffing how How obviously do issues and US visa coming the to fear with challenge with restrictions about lift COVID? to due

Rob Katz

we in no be international part, that will real for amount the the we - most that in doubt think them. a of And US, not we any bringing loss. assuming not Well, that I visa is are employees will no be there's material

On it the the than last for other years. of number hand, been rate has the obviously, unemployment is higher

So, in where working interested leisure have we the the people of obviously, industries, seen do be other And be we've course, the US, been resorts active in restaurant, of reduction workforce. who there feel like will these And elsewhere. many retail, that's in would right our biggest this folks year. at in might

up will in we the international we additional do employees be US. the like able so, feel with make to for loss hiring of And

Patrick Scholes

will season, And Australian cost structures, you then any North taking from season? you learned or American the be to specifically the ski forward high lessons takeaways level issues that ski operational that

Rob Katz

experience. We think pieces. in even tremendous to terms in to those it in where a a lesson do critical people They sophisticated food though brought launching going into we overall visitation. like with be And did kind that reservation a was not saw opportunity adjusted. at create a give A now, system to to we're are us the they much us key dial obviously to for saw and that exactly had were was great very, wanted. when of and in very may think we the that. they while experience restaurants we enthusiasm of the other And We custom how or restaurant that the and took for themselves capacity things resort. they to was get Australia. key quickly a manage to get of the burned Perisher a feel to we lesson system may Australia And I which saw limited taken more really guest approach understood that limited we've the in

same. resorts. many we tremendous in like are maybe limitations has resonates excitement actually one think how that lift as naturally they to spacing feel that’s with execute the that I people, loaded and COVID, one, and successfully. demand as during do can anything, and of of able much we and is getting it's to the learn ski And a one at on experience the is, And were people terms for that the there's a core because even we that it's lot out outdoors

Patrick Scholes

the I look coming to we to bypass village lines have there. cascade running lift the that the the potential you'll early this can Hopefully, season. forward and so year use

thank advance for in you that. So

Rob Katz

to sure that. Absolutely. do make We'll

Operator

question We Berenberg. of from will take Alex our Maroccia next

Alex Maroccia

cheaper impact million in $XX deferred full? applies assume just explanation be this original is like in makes revs you the the the pass mechanics should deferred Epic Can recognized of to remaining we circumstances the a to that won't somebody Pass credits of and price the going cheaper explain only pass. where revenue, in how website of sound chooses the The not pass it credit

Rob Katz

unique that equal credit so could individual - mechanics this be a credit everybody way And the One an the for the credit full the of that greater year. things. got is in an is credit. couple or amount So pass used dollar work price that

to credit If were purchase essentially your that the percentage pass, you the paying. reduce of reduced downgrade maintain was to you the - price wanted also same

an usage The deferred usage we revenue of revenue - do Just total balance the it why we the forms, be. when couldn't don't estimate reasons we out online. of the one what the on deferred last And deferred until don't get that put be of was year. year these will we sheet of rest what was revenue final we through would the this know that

December so update in And won't we’ll to know that we everybody release. until our be able

Alex Maroccia

And then, in you you to And might timing are the change to expecting be what's the see normal secondly, then of refunds given potential coverage? CapEx with Epic CapEx, prioritized? you XXXX fiscal when resume going

Rob Katz

would to yes, XXXX, we of - monitoring really in incorporating we'll year, year. the This this - which we're make we're not happened And any not course year point, sure be calendar going this are closely. season what plan we for at terms season. making really before with out of spending, come capital adjustments after we're So happen any to obviously, the CapEx

conservative I definitely travel think as feel we that COVID approach, as though year environment conservative to guest be last And, improved. has what experience, review. we on the around just to be in of a have, last the impact always all we've not of will and and certainly projects still be, some top of a to as projects we we’ll hopefully next will year the the we because year prioritizing, terms likely this the from course going yes, or think significant of yes, deferred will that in have year year next we're list like

Operator

next take Paul question Macquarie. We Golding from our of will

Paul Golding

give XXXX, any in if And could on through cost or breakdown of we capacity. there’s marketing reductions there to drive-up In So, maybe might to season could following back I’m expect over expectations question predominance segment, the in come that, $XX amount savings fiscal any the second any figure around local is something something segment? that Lodging my Thanks. how years. And for that limitation flow then you can the around or capacity? this expectations at that curious, indicate what looking that million of around

Rob Katz

Sure.

At of people related is give that additional were which marketing we to that details point, On the a within feeling marketing. savings, very this obviously going that granularity lot credits or incentive. offering component is obviously on cost savings, cost there that A that. big a the to was to yes, were not

And so, assume would normal yes, say Resorts. point, for at still the $XX does year, probably would right? needed we operating this marketing the the component for less back. this side, I limitations normal come And would majority yes, that. see any on in our that on Lodging marketing anticipating And, The we the a marketing structure, external of capacity. we're, smaller relate I expense - is million room on side, that vast that not than to think, of

always Of local going be that's to course, to subject regulations.

be course, But we'll, So, planning at of on that. not point, we're that. this following

less I whether in things. think Lodging, spa some we the or certainly of food other be or the that's think, within activities will

limitations. So, this operator, not, other point, rooms, expecting a terms at like, capacity but reduction of any we're in of because

Operator

question And take we will last from our William Blair. Ryan Sundby of

Ryan Sundby

in additional on City. feel do you visitation of maybe like of on like you're like see it potential skier some see visits into destination northeast. how I you just Snow. the does we could Park on of Mount to maybe Because western maybe add the them out want of mountain to a going that there? Could do much talk follow on not normal shift up could the maybe take resorts restrictions kind But terms something about if the the bigger capacity see a mountains strength Peak year you in in

Rob Katz

Yes.

time. is one-for-one like western additional I the could most we but our But a Again could there in I in - to really regional an planning again capacity west the to the issue. opportunity. Local on feel think there there a overall that all of there. smaller obviously for vacation. that’s capacity their as days which any strength say additional an saw to certainly resorts of to think again feel real I opportunity product are And the in going be is that. addition people only from northeast. about we add be option, far limitations I'd that feel of resorts, relation on size Snow a - talking capacity for And west. handful be it Obviously, visitation could Mount in from there there's - we great do out because of of tells But of going the what's good that couple subject good as a - to an Epic - we buy at Epic course, I where about also But think but transfer it's come not us people Peak front well. and opportunity think we COVID we and and people with and that we're material those was yes,

Ryan Sundby

passes people think in Got would expected. you it. than the hook you from a of any a Rob, kind discount you maybe forward of kind curious give this makes good just sales pass sense. think year? Do think standpoint, I That help holding better of can renewal of us And some then is have up Do kind idea? that’ll going

Rob Katz

there's know You no doubt.

season advance ultimate from the program lost commitment we visitation if we we program but a the quite out program, but if last that people a okay, about of think concerned lot piece. COVID I material credit a could our certainly with that concerns take loyalty. chance were and I year loyalty coming I to hit. possibility the obviously the this the think created into disappointed of saw course create down between people the that And was think Even our there being for season we about came

together year I to are churn, cases, that's we to was used of think even of we've in likely And season. the a put the what we we wouldn't don't got were This on we're don't with think And loyalty who more that low again there last clear think proud so of place resort people don't forward, refund the this from think of last incent situation we with going did - I program. very go we see people most quite I of a usage And necessarily because if sophistication this right, dynamics as - in program the from some something that this closures. is obviously forward, year. odd got. this we no, course, unique think

had that to that - before. and And back be normal I we're we much high more for of into assume we so would that very a and return riders. good to going the that to news moving skiers going committed we'll But we the with of approach would is us think much be loyal same kind level

that in big so what our looks like we And about minds win life think a as is post-COVID.

Ryan Sundby

dividend And or still straighten rates, then Excellent. two out? on the just thinking quarters could of that kind last

Rob Katz

You know, I quarter But there - that this we're that. decisions in I yes, think point, not on Obviously, we we the sure at we've making around certain obviously that are feel raised. company. sensitive any too the to like incredibly it real jump stabilization. quarter. notes think take by the we'll if early make dynamics But And be and we we're to seen don't going we environment don't we'll one, restrictions

I saw returning once we and before other environment certainly to quite were I would that go stabilize. COVID, to aggressive hand, obviously think on the shareholders On back think we the capital we

Operator

in further the questioning you. queue. are Thank questions no There

Rob Katz

today. time this call. Operator. should Thank for directly you or and your any concludes on our joined This XXXX contact good-bye. us you, free you fiscal afternoon year-end have who conference Michael earnings questions. Thank Please everyone feel Thanks call me the further to to

Operator

today's and gentlemen. Thank presentation. concludes ladies you, This

may You disconnect. now

Vail Resorts (MTN) 24 Sep 202020 Q4 Earnings call transcript