Vail posts $158M Q4 loss as COVID closures tanked 2020 earnings

BROOMFIELD — Early closures of Vail Resorts Inc. (NYSE: MTN) ski areas in the wake of the COVID-19 pandemic torpedoed the firm’s earnings in fiscal year 2020. On Thursday, Vail posted a fiscal-year fourth quarter loss of nearly $158 million, compared to a $92.3 million loss during the same period in 2019. The firm attributed those results to the delayed opening of winter resorts in Australia and summer resorts in North America. For the entirety of the 2020 fiscal year, Vail recorded $109 million in net income. That accounts for barely one-third of earnings in 2019.  Vail reported its results after the close of trading Thursda,y when the firm’s end of day stock price was $224.23. Immediately after the bell, the stock price plummeted to $217 in after hours trading before bouncing back a half-hour later.  “Our results for the full year were negatively impacted by COVID-19 and the resulting closure of our North American destination mountain resorts and regional ski areas beginning on March 15, 2020 for the safety of our guests, employees and resort communities,” Vail CEO Rob Katz said in a statement accompanying the firm’s earnings report. “In addition, Resort Reported EBITDA for the year was negatively impacted by the deferral of approximately $118 million of pass product revenue and related deferred costs to fiscal 2021 as a result of pass holder credits offered to 2019/2020 North American pass holders to encourage renewal for the 2020/2021 season.” Katz continued: “Following the resort closures and throughout the remainder of the fiscal year, we implemented a number of actions to enhance our liquidity and reduce costs, including raising $600 million through the issuance of unsecured senior notes, suspending our dividend for a cash savings of over $70 million per quarter, reducing our capital plan for calendar year 2020 by approximately $80-85 million, and executing significant reductions in our operating expenses.” Vail is not offering guidance for 2021 at this time, according to Katz. “That said, we are very pleased with the results of our season pass sales to date and the indication that may provide on the loyalty and commitment of our guests to our resorts, even in the current environment,” he said in a statement. “Given the broader dynamics in the travel industry, we do expect to see material declines in visitation to our resorts and associated revenue declines in fiscal 2021 relative to our original visitation expectations for fiscal 2020, primarily as a result of expected declines in visitation from non-pass, lift ticket purchases.”   © 2020 BizWest Media LLC
Source: BizWest

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