13 unchanged sentences
Refer to the end of the Results of Operations section for a reconciliation of net income attributable to Vail Resorts, Inc.
−Removed: to Total Reported EBITDA and long-term debt, net to Net Debt.
−Removed: Items excluded from Reported EBITDA and Net Debt are significant components in understanding and assessing financial performance or liquidity.
−Removed: Reported EBITDA and Net Debt should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the Consolidated Financial Statements as indicators of financial performance or liquidity.
+Added: to Total Reported EBITDA and Resort Reported EBITDA, and long-term debt, net to Net Debt.
+Added: Items excluded from Resort Reported EBITDA, Total Reported EBITDA and Net Debt are significant components in understanding and assessing financial performance or liquidity.
+Added: Resort Reported EBITDA, Total Reported EBITDA and Net Debt should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the Consolidated Financial Statements as indicators of financial performance or liquidity.
Because Resort Reported EBITDA, Total Reported EBITDA and Net Debt are not measurements determined in accordance with GAAP and are thus susceptible to varying calculations, Resort Reported EBITDA, Total Reported EBITDA and Net Debt, as presented herein, may not be comparable to other similarly titled measures of other companies.
8 unchanged sentences
*Denotes a destination mountain resort, which generally receives a meaningful portion of skier visits from long-distance travelers, as opposed to our regional ski areas, which tend to generate skier visits predominantly from their respective local markets.
−Removed: Additionally, we operate ancillary services, including ski school, dining and retail/rental operations, and for our Australian ski areas, including lodging and transportation operations.
−Removed: Mountain segment revenue is seasonal, with the majority of revenue earned from our North American destination mountain resorts and regional ski areas (collectively, our “Resorts”) occurring in our second and third fiscal quarters and the majority of revenue earned from our Australian ski areas occurring in our first and fourth fiscal quarters.
−Removed: Our North American Resorts are typically open for business from mid-November through mid-April, which is the peak operating season for the Mountain segment, and our Australian ski areas are typically open for business from June to early October.
−Removed: Our single largest source of Mountain segment revenue is the sale of lift tickets (including pass products), which represented approximately 64%, 53% and 53% of Mountain segment net revenue for Fiscal 2021, the fiscal year ended July 31, 2020 (“Fiscal 2020”) and the fiscal year ended July 31, 2019 (“Fiscal 2019”), respectively.
+Added: Additionally, we operate ancillary services, primarily including ski school, dining and retail/rental operations, and for our Australian ski areas, including lodging and transportation operations.
+Added: Mountain segment revenue is seasonal, with the majority of revenue earned from our North American ski operations occurring in our second and third fiscal quarters and the majority of revenue earned from our Australian ski operations occurring in our first and fourth fiscal quarters.
+Added: Our North American destination mountain resorts and regional ski areas (collectively, “Resorts”) typically experience their peak operating season for the Mountain segment from mid-December through mid-April, and our Australian ski areas typically experience their peak operating season from June to earl y October .
+Added: Our largest source of Mountain segment revenue comes from the sale of lift tickets (including pass products), which represented approximately 59%, 63% and 53% of Mountain segment net revenue for Fiscal 2022, the fiscal year ended July 31, 2021 (“Fiscal 2021”) and the fiscal year ended July 31, 2020 (“Fiscal 2020”), respectively.
Lift revenue is driven by volume and pricing.
Pricing is impacted by both absolute pricing, as well as the demographic mix of guests, which impacts the price points at which various products are purchased.
−Removed: The demographic mix of guests that visit our North American mountain resorts is divided into two primary categories:
−Removed: (1) out-of-state and international (“Destination”) guests and (2) in-state and local (“Local”) guests.
−Removed: For the 2020/2021 North American ski season, Destination guests comprised approximately 52% of our North American destination mountain resort skier visits (excluding complimentary access), while Local guests comprised approximately 48%, which compares to approximately 58% and 42%, respectively, for the 2019/2020 North American ski season and approximately 57% and 43%, respectively, for the 2018/2019 North American ski season.
+Added: The demographic mix of guests that visit our North American Resorts is divided into two primary categories:
+Added: (i) out-of-state and international (“Destination”) guests and (ii) in-state and local (“Local”) guests.
+Added: For the 2021/2022 North American ski season, Destination guests comprised approximately 58% of our North American destination mountain resort skier visits (excluding complimentary access), while Local guests comprised approximately 42% of our North American destination mountain resort skier visits (excluding complimentary access), which compares to 52% and 48%, respectively, for the 2020/2021 North American ski season and approximately 58% and 42%, respectively, for the 2019/2020 North American ski season.
Skier visitation at our regional ski areas is largely comprised of Local guests.
Destination guests generally purchase our higher-priced lift tickets (including pass products) and utilize more ancillary services such as ski school, dining and retail/rental, as well as lodging at or around our mountain resorts.
−Removed: The impacts of COVID-19, including travel restrictions, had a disproportionately adverse impact on Destination visitation, particularly international guests, as demand for long-distance travel was lower than normal throughout the 2020/2021 North American ski season.
−Removed: Additionally, Destination guest visitation is less likely to be impacted by changes in the weather during the current ski season, but may be more impacted by adverse economic conditions, the global geopolitical climate or weather conditions in the immediately preceding ski season.
+Added: Additionally, Destination guest visitation is less likely to be impacted by changes in the weather during the current season, but may be more impacted by adverse economic conditions, the global geopolitical climate or weather conditions in the immediately preceding ski season.
Local guests tend to be more value-oriented and weather sensitive.
−Removed: We offer a variety of pass products for all of our Resorts marketed towards both Destination and Local guests.
+Added: We offer a variety of pass products for all of our Resorts, marketed toward both Destination and Local guests.
Our pass product offerings range from providing access to one or a combination of our Resorts for a certain number of days to our Epic Pass, which allows pass holders unlimited and unrestricted access to all of our Resorts.
−Removed: The Epic Day Pass is a customizable one to seven day pass product purchased in advance of the season, for those skiers and riders who expect to ski a certain number of days during the season, and which is available in two tiers of resort access offerings.
−Removed: For the 2021/2022 North American ski season, we reduced prices of our entire portfolio of pass products by 20%.
−Removed: Our pass program provides a compelling value proposition to our guests, which in turn assists us in developing a loyal base of customers who commit to ski at our Resorts generally in advance of the ski season and typically ski more days each season at our Resorts than those guests who do not buy pass products.
−Removed: Additionally, we have entered into strategic long-term season pass alliance agreements with third-party mountain resorts including Telluride Ski Resort in Colorado, Sun Valley Resort in Idaho, Snowbasin Resort in Utah, Hakuba Valley and Rusutsu Resort in Japan, Resorts of the Canadian Rockies in Canada, Les 3 Vallées in France, 4 Vallées in Switzerland, Skirama Dolomiti in Italy and Ski Arlberg in Austria, which further increases the value proposition of our pass products.
−Removed: As such, our pass program drives strong customer loyalty, mitigates exposure to more weather sensitive guests, generates additional ancillary spending and provides cash flow in advance of winter season operations.
+Added: The Epic Day Pass is a customizable one to seven day pass product purchased in advance of the season, for those skiers and riders who expect to ski a certain number of days during the season, and which is available in three tiers of resort access offerings.
+Added: Our pass products provide a compelling value proposition to our guests, which in turn assists us in developing a loyal base of customers who commit to ski at our Resorts in advance of the ski season and typically ski more days each season at our Resorts than those guests who do not buy pass products.
+Added: Additionally, we enter into strategic long-term pass alliance agreements with third-party mountain resorts, which further increase the value proposition of our pass products.
+Added: For the 2022/2023 ski season, our pass alliances include Telluride Ski Resort in Colorado, Hakuba Valley and Rusutsu Resort in Japan, Resorts of the Canadian Rockies in Canada, Les 3 Vallées in France, Verbier 4 Vallées in Switzerland, Skirama Dolomiti in Italy and Ski Arlberg in Austria.
+Added: Our pass program drives strong customer loyalty;
+Added: mitigates exposure to more weather sensitive guests;
+Added: generates additional ancillary spending;
+Added: and provides cash flow in advance of winter season operations.
In addition, our pass program attracts new guests to our Resorts.
All of our pass products, including the Epic Pass and Epic Day Pass, are predominately sold prior to the start of the ski season.
−Removed: Pass product revenue, although primarily collected prior to the ski season, is recognized in the Consolidated Statements of Operations throughout the ski season primarily based on historical visitation (excluding visitation data for Fiscal 2020, which we do not believe is indicative of future visitation due to the early resort closures associated with COVID-19 in March 2020).
−Removed: Lift revenue consists of pass product lift revenue (“pass revenue”) and non-pass product lift revenue (“non-pass revenue”).
−Removed: Approximately 61%, 51% and 47% of total lift revenue was derived from pass revenue for Fiscal 2021, Fiscal 2020 and Fiscal 2019, respectively (including the impact of the deferral of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of the Credit Offer, as defined below).
−Removed: Additionally, lift revenue for Fiscal 2021 was impacted by the Company only allowing pass product holders to access the Resorts during the early portion of the 2020/2021 North American ski season, as well as the Company utilizing a reservation system, which limited capacity for both pass product holders and non-pass lift tickets.
+Added: Pass product revenue, although primarily collected prior to the ski season, is recognized in the Consolidated Statements of Operations throughout the ski season on a straight-line basis using skiable days (see Notes to the Consolidated Financial Statements for additional information).
+Added: Lift revenue consists of pass product lift revenue (“pass revenue”) and non-pass lift product revenue (“non-pass revenue”).
+Added: Approximately 61%, 61% and 51% of total lift revenue was derived from pass revenue for Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively (including the impact of the deferral of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of credits offered to 2019/2020 North American pass product holders who purchased 2020/2021 pass products).
+Added: Additionally, lift revenue for Fiscal 2021 was impacted by restrictions which only allowed pass product holders to access our Resorts during the early portion of the 2020/2021 North American ski season, as well as our use of a reservation system, which limited capacity for both pass product holders and non-pass lift tickets.
The cost structure of our mountain resort operations has a significant fixed component with variable expenses including, but not limited to, land use permit or lease fees, credit card fees, retail/rental cost of sales and labor, ski school labor and expenses associated with dining operations;
−Removed: As such, profit margins can fluctuate greatly based on the level of revenues associated with visitation.
+Added: as such, profit margins can fluctuate greatly based on the level of revenues.
Lodging Segment
−Removed: Operations within the Lodging segment include (i) ownership/management of a group of luxury hotels through the RockResorts brand proximate to our Colorado and Utah mountain resorts;
+Added: Operations within the Lodging segment include:
+Added: (i) ownership/management of a group of luxury hotels through the RockResorts brand proximate to our Colorado and Utah mountain resorts;
(ii) ownership/management of non-RockResorts branded hotels and condominiums proximate to our North American Resorts;
−Removed: (iii) National Park Service (“NPS”) concessionaire properties including Grand Teton Lodge Company (“GTLC”);
+Added: (iii) National Park Service (“NPS”) concessioner properties, including the Grand Teton Lodge Company (“GTLC”);
(iv) a Colorado resort ground transportation company;
and (v) mountain resort golf courses.
−Removed: The performance of our lodging properties (including managed condominium units and our Colorado resort ground transportation company) proximate to our mountain resorts is closely aligned with the performance of the Mountain segment and generally experiences similar seasonal trends, particularly with respect to visitation by Destination guests.
−Removed: Revenues from
−Removed: such properties represented approximately 64%, 73% and 70% of Lodging segment net revenue (excluding Lodging segment revenue associated with reimbursement of payroll costs) for Fiscal 2021, Fiscal 2020 and Fiscal 2019, respectively.
−Removed: Management primarily focuses on Lodging net revenue excluding payroll cost reimbursements and Lodging operating expense excluding reimbursed payroll costs (which are not measures of financial performance under GAAP) as the reimbursements are made based upon the costs incurred with no added margin;
−Removed: as such, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA, which we use to evaluate Lodging segment performance.
−Removed: Revenue of the Lodging segment during our first and fourth fiscal quarters is generated primarily by the operations of our NPS concessionaire properties (as their operating season generally occurs from June to the end of September);
+Added: The performance of our lodging properties (including managed condominium units) proximate to our Resorts, and our Colorado resort ground transportation company, are closely aligned with the performance of the Mountain segment and generally experience similar seasonal trends, particularly with respect to visitation by Destination guests.
+Added: Revenues from such properties represented approximately 73%, 67% and 75% of Lodging segment net revenue (excluding Lodging segment revenue associated with the reimbursement of payroll costs) for Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively.
+Added: Management primarily focuses on Lodging net revenue excluding payroll cost reimbursements and Lodging operating expense excluding reimbursed payroll costs (which are not measures of financial performance under GAAP) as the reimbursements are made based upon the costs incurred with no added margin and as such, the revenue and corresponding expense do not affect our Lodging Reported EBITDA, which we use to evaluate Lodging segment performance.
+Added: Revenue of the Lodging segment during our first and fourth fiscal quarters is generated primarily by the operations of our NPS concessioner properties (as their peak operating season generally occurs from mid-May through the end of September);
mountain resort golf operations and seasonally lower volume from our other owned and managed properties and businesses.
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Recent Trends, Risks and Uncertainties
−Removed: We have identified the following significant factors (as well as uncertainties associated with such factors) that could impact our future financial performance:
−Removed: • COVID-19 has led to travel restrictions and other adverse economic impacts including reduced consumer confidence, an increase in unemployment rates and volatility in global and local economies.
−Removed: Our operations continue to be negatively impacted by COVID-19 and associated government mandated restrictions, including capacity limitations, travel restrictions, and mask and social distancing requirements.
−Removed: Additionally, we may impose our own COVID-19 related restrictions in addition to what is required by state and local governments in the interest of safety for our guests, employees and resort communities.
−Removed: Although we are uncertain as to the ultimate severity and duration of the COVID-19 pandemic as well as the related global or other travel restrictions and other adverse impacts, we have seen a significant negative change in performance and our future performance could also be negatively impacted.
−Removed: In addition, the North American economy may be impacted by economic challenges in North America or declining or slowing growth in economies outside of North America, accompanied by devaluation of currencies, rising inflation, trade tariffs and lower commodity prices.
−Removed: We cannot predict the ultimate impact that the global economic uncertainty as a result of COVID-19 will have on overall travel and leisure spending or more specifically, on our guest visitation, guest spending or other related trends for the upcoming 2021/2022 North American ski season.
−Removed: • In the prior year, we announced the early closure of the 2019/2020 North American ski season for our Resorts, lodging properties and retail stores beginning on March 15, 2020.
−Removed: These actions (the “Resort Closures”) had a significant adverse impact on our results of operations for the year ended July 31, 2020.
−Removed: Additionally, on April 27, 2020, we announced that we would offer credits to customers who had purchased 2019/2020 North American pass products and who purchased 2020/2021 North American pass products on or before September 17, 2020 (the “Credit Offer”).
−Removed: The Credit Offer discounts ranged from a minimum of 20% to a maximum of 80% for season pass holders, depending on the number of days the pass holder used their pass product during the 2019/2020 season and a credit, with no minimum, but up to 80% for multi-day pass products, such as the Epic Day Pass, based on total unused days.
−Removed: As a result of the Credit Offer to 2019/2020 pass product holders, we delayed the recognition of approximately $120.9 million of season pass deferred revenue, as well as approximately $2.9 million of related deferred costs, that would have been recognized in Fiscal 2020 and which was instead primarily recognized in the second and third quarters of Fiscal 2021.
−Removed: • The ongoing impacts of the COVID-19 pandemic resulted in reduced visitation and decreased spending for the 2020/2021 North American ski season compared to the prior year through March 14, 2021, the equivalent date that we closed our Resorts early for the 2019/2020 North American ski season due to the outbreak of COVID-19.
−Removed: These declines were primarily driven by reduced demand for Destination visitation at our western resorts and COVID-19 related capacity limitations, which were further impacted by snowfall levels that were well below average at our Colorado, Utah and Tahoe resorts from the early season throughout the holiday season.
−Removed: Visitation and spending was also particularly
−Removed: impacted in regions where heightened COVID-19 restrictions were in place, including Whistler Blackcomb, Tahoe and Vermont.
−Removed: However, results continued to improve as the season progressed, primarily as a result of stronger Destination visitation at our Colorado and Utah resorts, including improved lift ticket purchases.
−Removed: Whistler Blackcomb’s results were disproportionately impacted as compared to our broader Mountain segment as a result of the Canadian travel restrictions and border closures, and were further impacted by the early closure of Whistler Blackcomb on March 30, 2021 following a provincial health order issued by the government of British Columbia due to an increase in COVID-19 cases in the region.
−Removed: Our Fiscal 2021 first quarter results were negatively impacted by Mount Hotham and Falls Creek, which opened for the 2020 Australian ski season on July 6, 2020, but we decided to close them four days later due to a “stay at home” order put in place by the Victorian government and specifically for the Melbourne metropolitan area, which represents the majority of visitors for Mount Hotham and Falls Creek, as a result of a reemergence of COVID-19 in the region.
−Removed: Additionally, our Australian ski areas were also impacted by “stay at home” orders and periodic resort closures during the 2021 ski season, which had a negative impact on our Fiscal 2021 fourth quarter results.
−Removed: The ongoing impacts of COVID-19 also resulted in reduced occupancy at our lodging properties during the 2019/2020 North American ski season following our early closure in March 2020, as well as during the 2020/2021 North American ski season.
−Removed: We closed our GTLC facilities including Jackson Lake Lodge and Jenny Lake Lodge during the summer of 2020, implemented restrictions on guided activities and in-restaurant dining, and temporarily closed many other facilities, which negatively impacted results for the first quarter of Fiscal 2021.
−Removed: These actions, trends, and the COVID-19 pandemic in general, had a significant adverse impact on our results of operations for the Fiscal 2020 and Fiscal 2021, and may continue to have a material, negative impact on our resorts and lodging properties for the fiscal year ending July 31, 2022 (“Fiscal 2022”).
+Added: We have identified the following important factors (as well as risks and uncertainties associated with such factors) that could impact our future financial performance or condition:
+Added: • COVID-19 has led to travel restrictions and other adverse economic impacts in global and local economies.
+Added: Our operations for Fiscal 2022 continued to be negatively impacted by COVID-19 and associated government-mandated restrictions, including capacity limitations, vaccination requirements and mask and social distancing requirements.
+Added: Additionally, we may impose our own COVID-19 related restrictions in addition to what is required by state and local governments in the interest of the safety of our guests, employees and resort communities.
+Added: The ongoing impacts of COVID-19 and associated regional shutdowns resulted in periodic closures of our Australian ski areas during their 2021 ski seasons.
+Added: Although conditions have improved relative to the prior year, we are uncertain as to the ultimate severity and duration of the COVID-19 pandemic as well as the related global or other travel restrictions and other adverse impacts.
+Added: We have experienced a negative change in performance and our future performance could also be negatively impacted.
+Added: In addition, the North American economy may be impacted by economic challenges in North America or declining or slowing growth in economies outside of North America, accompanied by devaluation of currencies, rising inflation, trade tariffs and fluctuating commodity prices.
+Added: While we anticipate improvements as compared to Fiscal 2022 and Fiscal 2021, we cannot predict the ultimate impact that the global economic uncertainty as a result of COVID-19 will have on overall travel and leisure spending or more specifically, on our guest visitation, guest spending or other related trends for the upcoming 2022/2023 North American ski season.
• The timing and amount of snowfall can have an impact on Mountain and Lodging revenue, particularly with regard to skier visits and the duration and frequency of guest visitation.
To help mitigate this impact, we sell a variety of pass products prior to the beginning of the ski season, which results in a more stabilized stream of lift revenue.
−Removed: In March 2021, we began our pass product sales program for the 2021/2022 North American ski season, which included a 20% reduction in price for all pass products.
−Removed: Pass product sales through September 17, 2021 for the upcoming 2021/2022 North American ski season increased approximately 42% in units and approximately 17% in sales dollars as compared to the period in the prior year through September 18, 2020, without deducting for the value of any redeemed credits provided to certain North American pass product holders in the prior period.
−Removed: To provide a comparison to the season pass results released on June 7, 2021, pass product sales through September 17, 2021 increased approximately 67% in units and approximately 45% in sales dollars as compared to the period through September 20, 2019, with pass product sales adjusted to include Peak Resorts pass sales in both periods.
−Removed: Pass product sales are adjusted to eliminate the impact of foreign currency by applying an exchange rate of $0.79 between the Canadian dollar and U.S.
−Removed: dollar in all periods for Whistler Blackcomb.
−Removed: We cannot predict if this favorable trend will continue through the fall 2021 North American pass sales campaign or the overall impact that pass sales will have on lift revenue for the 2021/2022 North American ski season.
−Removed: • Prior to the 2020/2021 North American ski season, we introduced Epic Coverage, which is included with the purchase of all pass products for no additional charge.
−Removed: Epic Coverage provides refunds in the event of certain resort closures and certain qualifying travel restrictions (e.g.
−Removed: for COVID-19), giving pass product holders a refund for any portion of the season that is lost due to qualifying circumstances.
−Removed: Additionally, Epic Coverage provides a refund for qualifying personal circumstances that were historically covered by our pass insurance program, including for eligible injuries, job losses and many other personal events.
−Removed: The estimated amount of refunds reduces the amount of pass product revenue recognized.
−Removed: We believe our estimate of refund amounts are reasonable;
−Removed: however, actual results could vary materially from such estimates, and we could be required to refund significantly higher amounts than estimated.
−Removed: Additionally, for the 2020/2021 North American ski season, we introduced Epic Mountain Rewards, a program which provides pass product holders a discount of 20% off on-mountain food and beverage, lodging, group ski school lessons, equipment rentals and more at our North American owned and operated Resorts.
−Removed: Epic Mountain Rewards constitutes an option to our guests to purchase additional products and services from us at a discount and as a result, we allocate a portion of the pass product transaction price to these other lines of business.
+Added: Additionally, our pass products provide a compelling value proposition to our guests, which in turn create a guest commitment predominately prior to the start of the ski season.
+Added: In March 2022, we began our pass product sales program for the 2022/2023 North American ski season.
+Added: Pass product sales through September 23, 2022 for the upcoming 2022/2023 North American ski season increased approximately 6% in units and approximately 7% in sales dollars as compared to the prior year through September 24, 2021.
+Added: Pass product sales are adjusted to include pass product sales for the Seven Springs Resorts in both periods and to eliminate the impact of foreign currency by applying an exchange rate of $0.76 between the Canadian dollar and U.S.
+Added: dollar to both periods for Whistler Blackcomb pass product sales.
+Added: We cannot predict if this favorable trend will continue through the remainder of the 2022 North American pass product sales campaign or the overall impact that pass product sales will have on lift revenue for the 2022/2023 North American ski season.
+Added: • The 2021/2022 North American ski season got off to a slow start with challenging early season conditions which persisted through the holiday period, but results were strong from January through the remainder of the season.
+Added: We had particularly strong Destination visitation this year, which was further supported by lift ticket sales at our Colorado and Utah resorts that exceeded our expectations through the spring.
+Added: Our results at Whistler Blackcomb were also stronger than expected after the holiday period due to the easing of travel restrictions in Canada in late February.
+Added: Additionally, after the holiday period, performance at our eastern U.S.
+Added: ski areas was in-line with our expectations while our Tahoe resorts were impacted by challenging spring conditions, resulting in performance below our expectations.
+Added: Throughout the season, our ancillary businesses continued to be capacity constrained by staffing and, in the case of dining, by operational restrictions associated with COVID-19.
+Added: During the fourth quarter of Fiscal 2022, our Australian resorts experienced record visitation, driven by strong demand following two years of COVID-19 related disruptions, continued momentum in advance commitment pass product sales following the addition of Hotham and Falls Creek in April 2019, and favorable early season conditions that continued throughout the quarter.
+Added: We cannot predict the impact that COVID-19 limitations and restrictions, future weather conditions or continued staffing challenges may have on our skier visitation and results of operations for the year ending July 31, 2023 (“Fiscal 2023”) and beyond.
• As of July 31, 2022, we had $1,107.4 million of cash and cash equivalents as well as $417.4 million available under the revolver component of our Eighth Amended and Restated Credit Agreement, dated as of August 15, 2018 and as amended most recently on December 18, 2020 (the “Vail Holdings Credit Agreement”), which represents the total commitment of $500.0 million less certain letters of credit outstanding of $82.6 million.
Additionally, we have a credit facility which supports the liquidity needs of Whistler Blackcomb (the “Whistler Credit Agreement”).
−Removed: As of July 31, 2021, we had C$243.1 million ($194.9 million) available under the revolver component of the Whistler Credit
−Removed: Agreement (which represents the total commitment of C$300.0 million ($240.5 million) less outstanding borrowings of C$56.0 million ($44.9 million) and a letter of credit outstanding of C$0.9 million ($0.7 million)).
−Removed: On December 18, 2020, we entered into the Fourth Amendment to our Vail Holdings Credit Agreement (the “Fourth Amendment”).
−Removed: Pursuant to the Fourth Amendment, among other terms, we are exempt from complying with the Vail Holdings Credit Agreement’s leverage ratio, senior secured leverage ratio, and interest coverage ratio financial maintenance covenants for each of the fiscal quarters ending through January 31, 2022 (unless we make a one-time irrevocable election to terminate such exemption prior to such date) (such period, the “Financial Covenants Temporary Waiver Period”), after which we will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as elected by us).
−Removed: During the Financial Covenants Temporary Waiver Period, we are subject to other restrictions which will limit our ability to make future acquisitions, investments, distributions to stockholders, share repurchases or incur additional debt.
−Removed: Additionally, on December 18, 2020, we completed an offering of $575.0 million in aggregate principal amount of 0.0% convertible senior notes due 2026 (the “0.0% Convertible Notes”) in a private placement conducted pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).
−Removed: The 0.0% Convertible Notes are senior, unsecured obligations that do not bear regular interest, and the principal amount of the 0.00% Convertible Notes does not accrete.
−Removed: The notes will mature on January 1, 2026, unless earlier repurchased, redeemed or converted.
−Removed: See Liquidity and Capital Resources for additional information.
+Added: As of July 31, 2022, we had C$281.6 million ($220.0 million) available under the revolver component of the Whistler Credit Agreement which represents the total commitment of C$300.0 million ($234.3 million) less outstanding borrowings of C$15.0 million ($11.7 million) and letters of credit outstanding of C$3.4 million ($2.6 million).
We believe that our existing cash and cash equivalents, availability under our credit agreements and the expected positive cash flow from operating activities of our Mountain and Lodging segments less resort capital expenditures will continue to provide us with sufficient liquidity to fund our operations.
+Added: • On December 31, 2021, through a wholly-owned subsidiary, we acquired Seven Springs Mountain Resort, Hidden Valley Resort and Laurel Mountain Ski Area in Pennsylvania (collectively, the “Seven Springs Resorts”) from Seven Springs Mountain Resort, Inc.
+Added: and its affiliates for a purchase price of approximately $116.5 million, after adjustments for certain agreed-upon terms, which we funded with cash on hand.
+Added: The acquisition included the mountain operations of the Seven Springs Resorts, including base area skier services (food and beverage, retail and rental, lift ticket offices and ski and snowboard school facilities), as well as hotel, conference center and other related operations.
+Added: We cannot predict the ultimate impact the acquisition of the Seven Springs Resorts will have on our future results from operations.
+Added: • On August 3, 2022, through a wholly-owned subsidiary, we acquired a 55% controlling interest in Andermatt-Sedrun Sport AG (“Andermatt-Sedrun”) from Andermatt Swiss Alps AG (“ASA”).
+Added: Andermatt-Sedrun controls and operates all of Andermatt-Sedrun's mountain and ski-related assets, including lifts, most of the restaurants and a ski school operation at the ski area.
+Added: We invested CHF 149.3 million ($155.7 million), comprised of a CHF 110.0 million ($114.4 million) investment into Andermatt-Sedrun for use in capital investments to enhance the guest experience on the mountain and CHF 39.3 million ($41.3 million) paid to ASA.
+Added: The proceeds paid to ASA will be fully reinvested into the real estate developments in the base area.
+Added: ASA retains a 40% ownership stake, with a group of existing shareholders comprising the remaining 5% ownership.
+Added: We will provide unlimited and unrestricted access to Andermatt-Sedrun on the Epic Pass for the 2022/2023 ski season, as well as provide access on other pass products.
+Added: We cannot predict the ultimate impact the acquisition of Andermatt-Sedrun will have on our future results from operations.
Results of Operations
9 unchanged sentences
Real Estate Reported EBITDA $ (3,927) $ (4,582) $ (4,128)
+Added: (1) Segment results for Fiscal 2021 and Fiscal 2020 have been retrospectively adjusted to reflect current period presentation.
+Added: See Notes to the Consolidated Financial Statements for additional information.
A discussion of segment results, including reconciliations of net income attributable to Vail Resorts, Inc.
to Total Reported EBITDA, and other items can be found below.
−Removed: The consolidated results of operations, including any consolidated financial metrics pertaining thereto, include the operations of Peak Resorts (acquired September 24, 2019), Falls Creek and Hotham (acquired April 4, 2019), Triple Peaks (acquired September 27, 2018) and Stevens Pass (acquired August 15, 2018), prospectively from their respective dates of acquisition.
−Removed: The Resort Closures had a significant adverse impact on our results of operations for Fiscal 2020.
−Removed: Additionally, COVID-19 continued to have an adverse impact on our results of operations for Fiscal 2021, as further described below in our segment results of operations.
+Added: The consolidated results of operations, including any consolidated financial metrics pertaining thereto, include the operations of the Seven Springs Resorts (acquired December 31, 2021) prospectively from the date of acquisition.
+Added: COVID-19 in general had an adverse impact on our results of operations for Fiscal 2022, Fiscal 2021 and Fiscal 2020 as further described below in our segment results of operations.
The sections titled “Fiscal 2022 compared to Fiscal 2021” and “Fiscal 2021 compared to Fiscal 2020” in each of the Mountain and Lodging segment discussions below provide comparisons of financial and operating performance for Fiscal 2022 to Fiscal 2021 and Fiscal 2021 to Fiscal 2020, respectively, unless otherwise noted.
3 unchanged sentences
2022 2021 (1)
+Added: 2022/2021 2021/2020
Mountain net revenue:
16 unchanged sentences
ETP $ 75.74 $ 72.49 $ 67.72 4.5 % 7.0 %
+Added: (1) Segment results for Fiscal 2021 and Fiscal 2020 have been retrospectively adjusted to reflect current period presentation.
+Added: See Notes to the Consolidated Financial Statements for additional information.
Mountain Reported EBITDA includes $20.9 million, $20.3 million and $17.4 million of stock-based compensation expense for Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively.
Fiscal 2022 compared to Fiscal 2021
−Removed: Mountain Reported EBITDA increased $50.3 million, or 10.1%, primarily due to the impact of the prior year Resort Closures, including the deferral of $120.9 million of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of the Credit Offer to 2019/2020 North American pass product holders, as well as cost discipline efforts in the current year associated with lower levels of operations.
+Added: Mountain Reported EBITDA increased $258.4 million, or 46.8%, primarily due to strong North American pass product sales growth for the 2021/2022 North American ski season and fewer COVID-19 related limitations and restrictions on our North American operations compared to the prior year.
+Added: Visitation across our North American Resorts increased relative to prior year levels, but was partially offset by the negative impact of delayed Resort openings due to challenging early season conditions.
+Added: Additionally, our Australian resorts had strong visitation during the fourth quarter of Fiscal 2022, compared to being negatively impacted by limitations and restrictions during the 2021 Australian ski season.
+Added: These increases were partially offset by an increase in variable expenses associated with the increase in revenue and visitation, and an increase in general and administrative expenses primarily due to cost discipline efforts in the prior year associated with lower levels of operations.
+Added: Mountain segment results for Fiscal 2022 also include acquisition and integration related expenses, including expenses associated with the acquisitions of the Seven Springs Resorts and Andermatt-Sedrun, of $7.7 million, compared to $1.0 million of acquisition and integration related expenses for Fiscal 2021.
+Added: Lift revenue increased $233.6 million, or 21.7%, primarily due to an increase in pass revenue and an increase in non-pass lift ticket purchases.
+Added: Pass revenue increased 21.5%, which was primarily driven by increased pass product sales for the 2021/2022 North American ski season compared to the 2020/2021 North American ski season, which were favorably impacted by increased pass product sales to new pass holders and Destination guests.
+Added: Non-pass revenue increased 22.0% primarily due to an increase in visitation, which was significantly impacted by COVID-19 related capacity limitations in the prior year, as well as an increase in non-pass ETP of 8.2%.
+Added: The increase in non-pass lift revenue was partially offset by delayed North American Resort openings as a result of challenging early season conditions, which negatively impacted visitation.
+Added: Ski school revenue increased $79.4 million, or 55.1%;
+Added: dining revenue increased $71.5 million, or 77.6%;
+Added: and retail/rental revenue increased $83.8 million, or 36.7%.
+Added: Each increased primarily due to fewer COVID-19 related limitations and restrictions on our North American winter operations as compared to the prior year, as well as an increase in demand over the prior year.
+Added: Other revenue mainly consists of summer visitation and other mountain activities revenue, employee housing revenue, guest services revenue, commercial leasing revenue, marketing revenue, private club revenue (which includes both club dues and amortization of initiation fees), municipal services revenue and other recreation activity revenue.
+Added: Other revenue also includes Australian ski area lodging and transportation revenue.
+Added: Other revenue increased $42.0 million, or 25.9%, primarily as a result of increased visitation and fewer COVID-19 related limitations and restrictions on our North American operations as compared to the prior year.
+Added: Operating expense increased $247.8 million, or 21.4%, which was primarily attributable to increased variable expenses associated with increases in revenue, and the impact of cost discipline efforts in the prior year associated with lower levels of operations, including limitations, restrictions and closures resulting from COVID-19.
+Added: Additionally, operating expense for Fiscal 2022 includes acquisition and integration related expenses, including expenses associated with the acquisitions of the Seven Springs Resorts and Andermatt-Sedrun, of $7.7 million, compared to $1.0 million of acquisition and integration related expense for Fiscal 2021.
+Added: Labor and labor-related benefits increased 22.5%, primarily due to increased staffing associated with an increase in visitation and the impact of COVID-19 related cost actions in the prior year, including salary reductions, as well as a decrease of $16.5 million in tax credits from COVID-19 related legislation in Canada.
+Added: Retail cost of sales increased 28.2%, compared to an increase in retail sales of 36.3%, reflecting increased margins on a higher mix of newer, higher-margin retail products.
+Added: Resort related fees increased 33.1%, primarily due to increases in revenue on which those fees are based.
+Added: General and administrative expense increased 15.5%, primarily due to an increase in corporate overhead costs due to cost reduction measures in the prior year to offset the impacts of COVID-19, as well as a decrease of $5.2 million in tax credits associated with COVID-19 related legislation in Canada and Australia.
+Added: Other expense increased 20.3%, primarily due to increases in variable operating expenses associated with increased revenues and visitation, as well as an increase in acquisition and integration related expenses of $6.7 million.
+Added: Mountain equity investment income, net primarily includes our share of income from the operations of a real estate brokerage company.
+Added: Mountain equity investment income from the real estate brokerage company decreased $4.1 million, or 61.5%, for Fiscal 2022 compared to Fiscal 2021 primarily due to a lower number of real estate sales.
+Added: Fiscal 2021 compared to Fiscal 2020
+Added: Mountain Reported EBITDA increased $49.3 million, or 9.8%, primarily due to the impact of the Fiscal 2020 Resort Closures, including the deferral of $120.9 million of pass product revenue from Fiscal 2020 to Fiscal 2021 as a result of the Credit Offer to 2019/2020 North American pass product holders, as well as cost discipline efforts in Fiscal 2021 associated with lower levels of operations.
These increases were partially offset by limitations and restrictions on our North American winter operations and closures, limitations and restrictions at Perisher, Falls Creek and Hotham during both the 2020 and 2021 Australian ski seasons.
−Removed: Additionally, Whistler Blackcomb’s performance was negatively impacted in the current year due to the continued closure of the Canadian border to international guests and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia.
+Added: Additionally, Whistler Blackcomb’s performance was negatively impacted in Fiscal 2021 due to the continued closure of the Canadian border to international guests and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia.
Mountain segment results also include $1.0 million and $13.6 million of acquisition and integration related expenses for Fiscal 2021 and Fiscal 2020, respectively, which are recorded within Mountain other operating expense.
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dollars, were favorably affected by increases in the Canadian dollar exchange rate relative to the U.S.
−Removed: dollar as compared to the prior year, resulting in an increase in Mountain Reported EBITDA of approximately $2 million, which the Company calculated by applying current period foreign exchange rates to the prior period results.
+Added: dollar for Fiscal 2021 as compared to Fiscal 2020, resulting in a decrease in Mountain Reported EBITDA of approximately $2.0 million, which the Company calculated by applying current period foreign exchange rates to the prior period results.
Lift revenue increased $163.5 million, or 17.9%, primarily due to the Company operating for the full U.S.
−Removed: ski season in the current year as compared to the shortened operating season in the prior year as a result of the Resort Closures, including the deferral impact of the Credit Offer from Fiscal 2020 to Fiscal 2021, partially offset by limitations and restrictions on our North American winter operations in the current year due to the ongoing impacts of COVID-19, which resulted in a decrease in non-pass visitation.
+Added: ski season in Fiscal 2021 as compared to the shortened operating season in Fiscal 2020 as a result of the Resort Closures, including the deferral impact of the Credit Offer from Fiscal 2020 to Fiscal 2021, partially offset by limitations and restrictions on our North American winter operations in Fiscal 2021 due to the ongoing impacts of COVID-19, which resulted in a decrease in non-pass visitation.
Pass product revenue increased 40.6%, primarily as a result of strong North American pass sales growth for the 2020/2021 ski season, including the deferral impact of the Credit Offer which was recognized primarily during Fiscal 2021.
Non-pass revenue decreased 5.7% due to reduced non-pass visitation to our Resorts, which were adversely impacted by COVID-19 related capacity limitations and snowfall levels that were well below average at our Colorado, Utah and Tahoe
−Removed: resorts through the holiday season, partially offset by an increase in non-pass ETP of 10.1% in the current year.
+Added: resorts through the holiday season, partially offset by an increase in non-pass ETP of 10.1%.
Visitation was particularly impacted in regions where heightened COVID-19 related restrictions were in place, including Whistler Blackcomb, Tahoe and Vermont.
−Removed: Additionally, Whistler Blackcomb’s results were disproportionately impacted as compared to our broader Mountain segment performance in the current year due to the continued closure of the Canadian border to international guests, and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia.
+Added: Additionally, Whistler Blackcomb’s results were disproportionately impacted as compared to our broader Mountain segment performance in Fiscal 2021 due to the continued closure of the Canadian border to international guests, and was further impacted by the resort closing earlier than expected on March 30, 2021 following a provincial health order issued by the government of British Columbia.
Ski school revenue, dining revenue and retail/rental revenue each decreased in Fiscal 2021 compared to Fiscal 2020 primarily due to the limitations and restrictions on our North American operations during Fiscal 2021 as a result of the impacts of COVID-19 on our business.
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For Fiscal 2021, other revenue decreased $24.7 million, or 13.3%, primarily due to decreased mountain activities and mountain services revenue as a result of limitations and restrictions on our business in Fiscal 2021 due to COVID-19, as well as a reduction in ski pass insurance revenue as a result of the replacement of our previous ski pass insurance program with Epic Coverage for the 2020/2021 North American ski season, which is free to all pass product holders.
−Removed: Operating expense decreased $65.9 million, or 5.4%, which was primarily attributable to cost discipline efforts in the current year associated with lower levels of operations and limitations, restrictions and closures of Resort operations resulting from COVID-19.
+Added: Operating expense decreased $68.1 million, or 5.6%, which was primarily attributable to cost discipline efforts in Fiscal 2021 associated with lower levels of operations and limitations, restrictions and closures of Resort operations resulting from COVID-19.
Additionally, operating expense includes $1.0 million and $13.6 million of acquisition and integration related expenses for Fiscal 2021 and Fiscal 2020, respectively.
−Removed: Labor and labor-related benefits decreased 4.4%, primarily due to cost discipline efforts in the current year associated with limitations, restrictions and closures of our Resort operations as a result of COVID-19, as well as incremental tax credits of approximately $10.3 million primarily associated with COVID-19 related legislation passed in Canada, partially offset by an increase in variable compensation.
+Added: Labor and labor-related benefits decreased 4.6%%, primarily due to cost discipline efforts in Fiscal 2021 associated with limitations, restrictions and closures of our Resort operations as a result of COVID-19, as well as incremental tax credits of approximately $10.3 million primarily associated with COVID-19 related legislation passed in Canada, partially offset by an increase in variable compensation.
Retail cost of sales decreased 20.4% compared to a decrease in retail sales of 23.5%, reflecting a higher mix of aged retail products sold at reduced margins.
4 unchanged sentences
Mountain equity investment income from the real estate brokerage company increased $5.0 million (296.3%) for Fiscal 2021 compared to Fiscal 2020 due to a significant increase in both the number of real estate sales and the average price of those sales.
−Removed: Fiscal 2020 compared to Fiscal 2019
−Removed: Mountain Reported EBITDA decreased $178.5 million, or 26.3%, primarily due to the impact of the deferral of $120.9 million of pass product revenue during Fiscal 2020 as a result of the Credit Offer to 2019/2020 North American pass product holders from the Resort Closures and the overall impacts of the COVID-19 pandemic, which resulted in significantly reduced visitation and operations at our Resorts and retail stores for the 2019/2020 North American ski season, the 2020 Australian ski season and our 2020 North American summer operations.
−Removed: These decreases were partially offset by the incremental operations of Peak Resorts, Falls Creek and Hotham.
−Removed: Mountain segment results include $13.6 million and $16.4 million of acquisition and integration related expenses for Fiscal 2020 and Fiscal 2019, respectively, which are recorded within Mountain other operating expense.
−Removed: Lift revenue decreased $120.1 million, or 11.6%, primarily due to a 3.4% decrease in pass product revenue and an 18.8% decrease in non-pass revenue.
−Removed: Pass product revenue decreased primarily as a result of the deferral of approximately $120.9 million of pass product revenue associated with the Credit Offer to 2019/2020 North American pass product holders, which would have been recognized during Fiscal 2020 and which was instead recognized primarily in the second and third quarters of Fiscal 2021, partially offset by a combination of an increase in pricing and units sold and increased pass sales to Destination guests, as well as the introduction of the Epic Day Pass.
−Removed: Non-pass revenue decreased primarily due to significantly
−Removed: reduced skier visitation as a result of the Resort Closures, partially offset by an increase in non-pass ETP (excluding Peak Resorts, Falls Creek and Hotham) of 6.2% and incremental revenue from Peak Resorts, Falls Creek and Hotham of approximately $61.4 million.
−Removed: Total non-pass ETP, including the impact of Peak Resorts, Falls Creek and Hotham decreased 7.3%.
−Removed: Ski school revenue, dining revenue and retail/rental revenue in Fiscal 2020 all decreased compared to Fiscal 2019 due to the Resort Closures.
−Removed: These decreases were partially offset by incremental revenue from our acquisitions of Peak Resorts, Falls Creek and Hotham of $18.0 million of ski school revenue, $23.8 million of dining revenue and $26.8 million of retail/rental revenue.
−Removed: Other revenue mainly consists of summer visitation and mountain activities revenue, employee housing revenue, guest services revenue, commercial leasing revenue, marketing and internet advertising revenue, private club revenue (which includes both club dues and amortization of initiation fees), municipal services revenue and other recreation activity revenue.
−Removed: Other revenue is also comprised of Australian ski area lodging and transportation revenue.
−Removed: For Fiscal 2020, other revenue decreased as a result of the Resort Closures, partially offset by incremental revenue from Peak Resorts of approximately $12.6 million.
−Removed: Resort Closures and the associated actions taken by the Company to reduce costs resulted in a decrease in our operating expense of $67.5 million, or 5.3%, which includes incremental operating expenses from Peak Resorts, Falls Creek and Hotham of approximately $121.4 million, as well as $13.6 million and $16.4 million of acquisition and integration related expenses for Fiscal 2020 and Fiscal 2019, respectively.
−Removed: Labor and labor-related benefits decreased 6.8%, which primarily resulted from cost actions associated with the Resort Closures, including decreased staffing, employee furloughs, salary reductions and reduced variable compensation accruals, as well as tax credits of approximately $12.0 million associated with COVID-19 related legislation passed in the U.S., Canada and Australia, partially offset by incremental expenses from Peak Resorts, Falls Creek and Hotham of approximately $50.7 million.
−Removed: Retail cost of sales decreased 20.5% compared to a decrease in retail sales of 20.1%.
−Removed: Resort related fees decreased 22.0% primarily due to decreases in revenue on which those fees are based, partially offset by incremental expenses from Peak Resorts of approximately $4.3 million.
−Removed: General and administrative expense increased 2.7% primarily due to incremental expenses from Peak Resorts, Falls Creek and Hotham of approximately $18.9 million, partially offset by a decrease in allocated corporate overhead costs, a decrease in variable compensation accruals primarily as a result of the Resort Closures and tax credits of approximately $3.3 million associated with COVID-19 related legislation passed in the U.S., Canada and Australia.
−Removed: Other expense increased 2.1% primarily due to incremental operating expenses from Peak Resorts, Falls Creek and Hotham of approximately $42.2 million, partially offset by decreases in variable operating expenses associated with the Resort Closures, as well as a decrease in acquisition and integration related expenses.
−Removed: Mountain equity investment income, net primarily includes our share of income from the operations of a real estate brokerage joint venture.
Lodging Segment
−Removed: Lodging segment operating results for Fiscal 2021, Fiscal 2020 and Fiscal 2019 are presented by category as follows (in thousands, except ADR and RevPAR):
+Added: Lodging segment operating results for Fiscal 2022, Fiscal 2021 and Fiscal 2020 are presented by category as follows (in thousands, except average daily rate (“ADR”) and revenue per available room (“RevPAR”)):
Year ended July 31, Increase/(Decrease)
2022 2021 (1)
+Added: 2022/2021 2021/2020
Lodging net revenue:
25 unchanged sentences
RevPar $ 133.53 $ 85.99 $ 90.37 55.3 % (4.8) %
−Removed: (1) RevPAR for Fiscal 2021 and Fiscal 2020 declined from Fiscal 2019 primarily due to limitations and restrictions on our North American operations resulting from COVID-19, as well as the impact of the Resort Closures.
+Added: (1) Segment results for Fiscal 2021 and Fiscal 2020 have been retrospectively adjusted to reflect current period presentation.
+Added: See Notes to the Consolidated Financial Statements for additional information.
Lodging Reported EBITDA includes $3.7 million, $3.8 million and $3.4 million of stock-based compensation expense for Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively.
Fiscal 2022 compared to Fiscal 2021
−Removed: Lodging Reported EBITDA for Fiscal 2021 decreased $9.0 million, or 275.4%, primarily as a result of limitations and restrictions on our North American operations in the current year as a result of the impacts of COVID-19, which resulted in reduced occupancy and capacity-related restrictions at our lodging properties compared to the prior year.
+Added: Lodging Reported EBITDA increased $33.8 million, or 418.0%, primarily as a result of fewer COVID-19 capacity-related restrictions and limitations on our North American operations compared to the prior year, which resulted in increased occupancy at our lodging properties as compared to the prior year, as well as an increase in ADR of 16.1% driven by increased pricing at our owned hotels and managed condominiums due to an increase in demand particularly for group visitation.
+Added: Additionally we benefited from the incremental operations of the Seven Springs Resorts (acquired in December 2021) which generated $5.8 million of EBITDA in the current year.
+Added: These increases were partially offset by increased general and administrative expenses primarily due to COVID-19 related cost management in the prior year.
+Added: Revenue from owned hotel rooms, managed condominium rooms, dining, transportation, golf and other revenue each increased primarily as a result of fewer COVID-19 related limitations and restrictions as compared to the prior year, as well as an increase in demand over the prior year and incremental revenue from the Seven Springs Resorts of $18.7 million.
+Added: Operating expense (excluding reimbursed payroll costs) increased 32.9%, including incremental operating expenses from the Seven Springs Resorts of $12.9 million.
+Added: Labor and labor related benefits increased 34.4%, primarily due to increased staffing associated with improved North American operations in the current year as a result of fewer COVID-19 related limitations and restrictions and increased demand, as well as the impact of salary reductions in the prior year.
+Added: General and administrative expense increased 26.0% primarily due to an increase in allocated corporate overhead costs for nearly all functions, which were impacted in the prior year by COVID-19 related cost management.
+Added: Other expense increased 35.1%, primarily related to higher variable expenses associated with increased revenue.
+Added: Revenue from payroll cost reimbursement and the corresponding reimbursed payroll costs relate to payroll costs at managed hotel properties where we are the employer and all payroll costs are reimbursed by the owners of the properties under contractual arrangements.
+Added: Since the reimbursements are made based upon the costs incurred with no added margin, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA.
+Added: Fiscal 2021 compared to Fiscal 2020
+Added: Lodging Reported EBITDA for Fiscal 2021 decreased $8.0 million or 8797.8%, primarily as a result of limitations and restrictions on our North American operations in Fiscal 2021 as a result of the impacts of COVID-19, which resulted in reduced occupancy and capacity-related restrictions at our lodging properties compared to Fiscal 2020.
Revenue from managed condominium rooms, dining, transportation and other revenue each decreased primarily as a result of the impacts of COVID-19.
−Removed: These decreases were partially offset by increases in revenue from golf, primarily due to strong
−Removed: summer demand in Fiscal 2021, and owned hotel rooms, primarily as a result of increased revenue from GTLC and partially offset by decreases at our other lodging properties as a result of the impacts of COVID-19.
+Added: These decreases were partially offset by increases in revenue from golf, primarily due to strong summer demand in Fiscal 2021, and owned hotel rooms, primarily as a result of increased revenue from GTLC and partially offset by decreases at our other lodging properties as a result of the impacts of COVID-19.
Operating expense (excluding reimbursed payroll costs) decreased 6.8%.
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Since the reimbursements are made based upon the costs incurred with no added margin, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA.
−Removed: Fiscal 2020 compared to Fiscal 2019
−Removed: Lodging Reported EBITDA for Fiscal 2020 decreased $24.8 million, or 88.4%, primarily due to the impacts of the COVID-19 pandemic and the associated Resort Closures.
−Removed: Primarily as a result of the Resort Closures, revenue from owned hotel rooms, managed condominium rooms, dining, transportation, golf and other revenue each decreased.
−Removed: The decreases resulting from the Resort Closures were partially offset by $13.7 million of incremental revenue from Peak Resorts and Triple Peaks.
−Removed: Operating expense (excluding reimbursed payroll costs) decreased 13.8%.
−Removed: Labor and labor related benefits decreased 15.9% primarily due to cost actions associated with the Resort Closures, including decreased staffing, employee furloughs, salary reductions and reduced variable compensation accruals, as well as tax credits of approximately $2.2 million associated with recent COVID-19 related legislation passed in the U.S., Canada and Australia, partially offset by $6.4 million of incremental expenses from Peak Resorts and Triple Peaks.
−Removed: General and administrative expense decreased 4.8% due to lower allocated corporate overhead costs primarily associated with a reduction in variable compensation accruals, as well as tax credits of approximately $0.5 million associated with recent COVID-19 related legislation passed in the U.S., Canada and Australia.
−Removed: Other expenses decreased 14.7% primarily related to lower variable expenses associated with the impact of the Resort Closures, partially offset by $4.7 million of incremental expenses from Peak Resorts and Triple Peaks.
−Removed: Revenue from payroll cost reimbursement and the corresponding reimbursed payroll costs relate to payroll costs at managed hotel properties where we are the employer and all payroll costs are reimbursed by the owners of the properties under contractual arrangements.
−Removed: Since the reimbursements are made based upon the costs incurred with no added margin, the revenue and corresponding expense have no effect on our Lodging Reported EBITDA.
Real Estate Segment
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Other operating expense of $5.7 million was primarily comprised of general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs.
−Removed: During Fiscal 2020, we closed on the sale of a development land parcel for $4.1 million which was recorded within Real Estate net revenue, with a corresponding cost of sale (including sales commission) of $3.9 million.
+Added: We did not close on any significant real estate transactions during Fiscal 2021.
Other operating expense of $5.4 million was primarily comprised of general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs.
−Removed: We closed on two land sales during the third quarter of Fiscal 2019 with third party developers at Keystone (One River Run site) and Breckenridge (East Peak 8 site) for proceeds of approximately $16.0 million, including $4.8 million associated with the sale of density for the Breckenridge property.
−Removed: The land parcel sales were accounted for as financing arrangements as a result of the Company’s continuing involvement with the underlying assets that were sold, including but not limited to, the obligation to repurchase finished commercial space from the development projects upon completion.
−Removed: As a result, the estimated gain of $3.6 million associated with the East Peak 8 site and the estimated loss of $3.2 million associated with the One River Run site will be deferred until the Company no longer maintains continuing involvement.
−Removed: Additionally, the Company’s future obligation to repurchase finished commercial space in the two completed projects, as well as other related capital spending, will result in total estimated capital expenditures of up to approximately $9.5 million in future fiscal years.
+Added: During Fiscal 2020, we closed on the sale of a development land parcel for $4.1 million which was recorded within Real Estate net revenue, with a corresponding cost of sale (including sales commission) of $3.9 million.
Other operating expense of $5.3 million was primarily comprised of general and administrative costs, such as labor and labor-related benefits, professional services and allocated corporate overhead costs.
−Removed: Real Estate Reported EBITDA also included a gain on sale of real property of $0.6 million for the sale of land parcels.
In addition to segment operating results, the following items contributed to our overall financial position and results of operations (in thousands).
1 unchanged sentence
2022 2021 2020 2022/2021 2021/2020
−Removed: Depreciation and amortization $ (252,585) $ (249,572) $ (218,117) 1.2 % 14.4 %
Asset impairments $ — $ — $ (28,372) nm (100.0) %
−Removed: Change in fair value of contingent consideration $ (14,402) $ 2,964 $ (5,367) (585.9) % 155.2 %
+Added: Change in estimated fair value of contingent consideration $ (20,280) $ (14,402) $ 2,964 (40.8) % (585.9) %
+Added: Gain (loss) on disposal of fixed assets and other, net $ 43,992 $ (5,373) $ 838 918.8 % (741.2) %
Interest expense, net $ (148,183) $ (151,399) $ (106,721) 2.1 % (41.9) %
−Removed: Foreign currency gain (loss) on intercompany loans $ 8,282 $ (3,230) $ (2,854) 356.4 % (13.2) %
+Added: Foreign currency (loss) gain on intercompany loans $ (2,682) $ 8,282 $ (3,230) (132.4) % 356.4 %
Provision for income taxes $ (88,824) $ (726) $ (7,378) (12,134.7) % 90.2 %
Effective tax rate (19.4) % (0.6) % (6.3) % 18.8 pts (5.7 pts)
−Removed: Depreciation and amortization .
−Removed: Depreciation and amortization expense for Fiscal 2021 and Fiscal 2020 increased over Fiscal 2019 primarily due to assets acquired in the Peak Resorts acquisition (incremental impact of $24.3 million in Fiscal 2020 relative to Fiscal 2019), as well as discretionary capital projects completed at our resorts in each fiscal year.
+Added: Net (income) loss attributable to noncontrolling interest $ (20,414) $ 3,393 $ (10,222) (701.7) % 133.2 %
Asset impairments.
1 unchanged sentence
See Notes to the Consolidated Financial Statements for additional information.
−Removed: Change in fair value of contingent consideration.
−Removed: We recorded a loss of $14.4 million during Fiscal 2021 primarily related to improved performance compared to estimated results for Park City in Fiscal 2021, resulting in an increase in the expected payment for the year, as well as accretion resulting from the passage of time.
−Removed: We recorded a gain of $3.0 million during Fiscal 2020 primarily related to a decrease in the estimated Contingent Consideration payments for Fiscal 2020 and Fiscal 2021 as a result of a decrease in expected results due to the anticipated impacts of COVID-19.
−Removed: We recorded a loss of $5.4 million during Fiscal 2019 primarily related to the estimated Contingent Consideration payment for Fiscal 2019.
+Added: Change in estimated fair value of contingent consideration.
+Added: We recorded losses of $20.3 million and $14.4 million during Fiscal 2022 and Fiscal 2021, respectively, primarily related to an increase in the estimated contingent consideration payment for each respective year, as well as accretion resulting from the passage of time.
+Added: We recorded a gain of $3.0 million during Fiscal 2020 primarily related to a decrease in the estimated Contingent Consideration payments for Fiscal 2020 and Fiscal 2021 as a result of a decrease in expected results due to the anticipated impacts of COVID-19 at that time.
The estimated fair value of contingent consideration is based on assumptions for EBITDA of Park City in future periods, as calculated under the lease on which participating payments are determined, and was $42.4 million and $29.6 million as of July 31, 2022 and 2021, respectively.
+Added: Gain (loss) on disposal of fixed assets and other, net .
+Added: Gain on disposal of fixed assets and other, net for Fiscal 2022 included (i) $32.2 million from the sale of the DoubleTree at Breckenridge hotel;
+Added: (ii) $10.3 million in proceeds from the NPS related to partial payments for a leasehold surrender interest at GTLC associated with assets that have been fully depreciated by the Company (payments were made at the request of the NPS);
+Added: and (iii) $7.9 million from the sale of an administrative building in Avon, CO.
+Added: These gains were partially offset by losses on other annual disposals of fixed assets.
Interest expense, net.
Interest expense, net for Fiscal 2021 increased compared to Fiscal 2020 primarily due to borrowings under our 6.25% unsecured bond offering, which was completed on May 4, 2020 (the “6.25% Notes”) and generated approximately $28.3 million of incremental interest expense in Fiscal 2021, and $12.5 million of non-cash interest expense associated with amortization of the debt discount for the 0.0% Convertible Notes, which were issued in December 2020.
−Removed: Interest expense, net for Fiscal 2020 increased compared to Fiscal 2019 primarily due to debt obligations assumed in the Peak Resorts acquisition;
−Removed: borrowings under our 6.25% unsecured bond offering which was completed on May 4, 2020;
−Removed: incremental term loan borrowings under the Vail Holdings Credit Agreement of $335.6 million, which were used to fund the Peak Resorts acquisition in September 2019;
−Removed: and incremental borrowings under the revolver components of our Vail Holdings Credit Agreement and Whistler Credit Agreement, which were almost entirely drawn on during Fiscal 2020 as a precautionary measure in order to increase our cash position and financial flexibility in light of the financial market conditions resulting from the COVID-19 pandemic and were subsequently paid down, partially offset by a decrease in variable interest rates.
−Removed: Foreign currency gain (loss) on intercompany loans.
−Removed: Foreign currency gain (loss) on intercompany loans for Fiscal 2021 increased as compared to Fiscal 2020 and decreased for Fiscal 2020 as compared to Fiscal 2019 as a result of the Canadian dollar fluctuating relative to the U.S.
+Added: Foreign currency (loss) gain on intercompany loans.
+Added: Foreign currency (loss) gain on intercompany loans for Fiscal 2022 decreased as compared to Fiscal 2021 and increased for Fiscal 2021 as compared to Fiscal 2020, both as a result of the Canadian dollar fluctuating relative to the U.S.
dollar, and was associated with an intercompany loan from Vail Holdings, Inc.
4 unchanged sentences
The effective tax rate was 19.4%, 0.6% and 6.3% in Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively.
+Added: The increase in the effective tax rate during Fiscal 2022 compared to Fiscal 2021 was primarily due to an increase in full fiscal year pre-tax book income, which lessens the tax rate impact from favorable permanent items and favorable discrete items, as well as a shift in income to higher tax rate jurisdictions.
The decrease in the effective tax rate provision during Fiscal 2021 compared to Fiscal 2020 was primarily driven by an increase in excess tax benefits from employee share awards that were exercised (stock appreciation rights) and that vested (restricted stock awards).
−Removed: The decrease in the effective tax rate during Fiscal 2020 compared to Fiscal 2019 was primarily due to lower full year pre-tax net income, as well as a one-time, provisional $3.8 million benefit related to the net operating loss carryback provision of the Coronavirus Aid, Relief, and Economic Security Act, partially offset by a decrease in excess tax benefits from employee share awards that were exercised (stock appreciation rights) and that vested (restricted stock awards).
−Removed: Reconciliation of Segment Earnings
+Added: Net (income) loss attributable to noncontrolling interest .
+Added: Net (income) loss attributable to noncontrolling interest is primarily associated with the income or loss attributable to the minority shareholder of Whistler Blackcomb, and accordingly, fluctuations are primarily associated with changes in income or loss from Whistler Blackcomb operations.
+Added: Reconciliation of Non-GAAP Measures
The following table reconciles net income attributable to Vail Resorts, Inc.
4 unchanged sentences
$ 347,923 $ 127,850 $ 98,833
−Removed: Net (loss) income attributable to noncontrolling interests (3,393) 10,222 22,330
+Added: Net income (loss) attributable to noncontrolling interests 20,414 (3,393) 10,222
Net income 368,337 124,457 109,055
3 unchanged sentences
Asset impairments — — 28,372
−Removed: Loss (gain) on disposal of fixed assets and other, net 5,373 (838) 664
−Removed: Change in fair value of contingent consideration 14,402 (2,964) 5,367
+Added: (Gain) loss on disposal of fixed assets and other, net (43,992) 5,373 (838)
+Added: Change in estimated fair value of contingent consideration 20,280 14,402 (2,964)
Investment income and other, net (3,718) (586) (1,305)
−Removed: Foreign currency (gain) loss on intercompany loans (8,282) 3,230 2,854
+Added: Foreign currency loss (gain) on intercompany loans 2,682 (8,282) 3,230
Interest expense, net 148,183 151,399 106,721
5 unchanged sentences
Total Reported EBITDA $ 832,987 $ 540,074 $ 499,221
+Added: (1) Segment results for Fiscal 2021 and Fiscal 2020 have been retrospectively adjusted to reflect current period presentation.
+Added: See Notes to the Consolidated Financial Statements for additional information.
The following table reconciles long-term debt, net to Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents) (in thousands):
11 unchanged sentences
Net cash used in investing activities $ (347,917) $ (103,329) $ (492,739)
−Removed: Net cash provided by (used in) financing activities $ 434,662 $ 376,233 $ (99,558)
−Removed: Historically, we have lower cash available at the end of each first and fourth fiscal quarter-end as compared to our second and third fiscal quarter-ends, primarily due to the seasonality of our Mountain segment operations, although our available cash balances as of July 31, 2021 and 2020 were higher than our historical July 31 balance as a result of the various debt offerings we completed in Fiscal 2021 and Fiscal 2020, and our suspension of dividend payments.
+Added: Net cash (used in) provided by financing activities $ (493,136) $ 434,662 $ 376,233
+Added: Historically, we have lower cash available at the end of each first and fourth fiscal quarter-end as compared to our second and third fiscal quarter-ends, primarily due to the seasonality of our Mountain segment operations, although our available cash balances as of July 31, 2022 and 2021 were higher than our historical July 31 balance primarily as a result of the debt offerings we completed in Fiscal 2021 and Fiscal 2020.
Fiscal 2022 compared to Fiscal 2021
We generated $710.5 million of cash from operating activities during Fiscal 2022, an increase of $185.2 million when compared to $525.3 million of cash generated during Fiscal 2021.
−Removed: The increase in operating cash flows was primarily a result of (i) an increase in accounts payable and accrued liabilities (excluding accounts payable and accrued liabilities assumed through acquisitions) primarily due to an increase in accrued trade payables, salaries and wages in the current year due to a return to more normal operations, as compared to significantly lower accruals in the prior year due to the Resort Closures;
−Removed: (ii) an increase in pass product sales and collections as compared to the prior year, primarily as a result of the impacts of COVID-19, including the extended pass product sales deadline in the prior year and the impact of the Credit Offer;
+Added: The increase in operating cash flows was primarily a result of increased Mountain and Lodging segment operating results during Fiscal 2022 compared to the prior year, including an increase in pass product sales and associated accounts receivable collections, net of refunds, during Fiscal 2022 compared to the prior year, which was impacted by the credits offered to 2019/2020 North American pass product holders who purchased 2020/2021 pass products.
+Added: These increases were partially offset by (i) a decrease in cash flows from accounts payable and accrued liabilities, primarily associated with the lower level of operations as of the beginning of Fiscal 2021 resulting from COVID-19 and (ii) an increase in inventory purchases during Fiscal 2022 compared to the prior year.
+Added: Cash used in investing activities for Fiscal 2022 increased by $244.6 million primarily due to (i) cash payments of $116.3 million, net of cash acquired of $0.2 million, related to the acquisition of the Seven Springs Resorts during Fiscal 2022;
+Added: (ii) a cash deposit of $114.4 million made in July 2022 related to the acquisition of Andermatt-Sedrun, which closed on August 3, 2022;
+Added: and (iii) an increase in capital expenditures of $77.7 million as a result of the deferral of discretionary capital projects in the prior year related to our decision to prioritize near-term liquidity due to the effects of COVID-19.
+Added: These increases were partially offset by proceeds of $40.5 million from the sale of the DoubleTree at Breckenridge during Fiscal 2022, as well as proceeds of $10.3 million from the NPS related to partial payments for leasehold surrender interest at GTLC associated with assets that have been fully depreciated and the sale of an administrative building in Avon, CO for $11.3 million.
+Added: Cash (used in) provided by financing activities decreased by $927.8 million during Fiscal 2022 compared to Fiscal 2021, primarily due to (i) prior year proceeds of $575.0 million from the issuance of our 0.0% Convertible Notes during Fiscal 2021;
+Added: (ii) an increase in dividends paid of $225.8 million;
+Added: (iii) an increase in repurchases of common stock of $75.0 million;
+Added: (iv) a $51.5 million repayment of debt associated with the maturity of the EB-5 Development Notes (as defined in Notes to Consolidated Financial Statements);
+Added: and (v) an increase in net payments under the revolver component of our Whistler Credit Agreement of $14.8 million.
+Added: These increases were partially offset by a decrease in financing costs primarily associated with the issuance of the 0.0% Convertible Notes in the prior year.
+Added: Fiscal 2021 compared to Fiscal 2020
+Added: We generated $525.3 million of cash from operating activities during Fiscal 2021, an increase of $130.3 million when compared to $395.0 million of cash generated during Fiscal 2020.
+Added: The increase in operating cash flows was primarily a result of (i) an increase in accounts payable and accrued liabilities (excluding accounts payable and accrued liabilities assumed through acquisitions) primarily due to an increase in accrued trade payables, salaries and wages in Fiscal 2021 due to a return to more normal operations, as compared to significantly lower accruals in the prior year due to the early closure of the 2019/2020 North American ski season for our Resorts, lodging properties and retail stores beginning on March 15, 2020;
+Added: (ii) an increase in pass product sales and collections as compared to Fiscal 2020, primarily as a result of the impacts of COVID-19, including the extended pass product sales deadline in the prior year and the impact of credits offered to 2019/2020 North American pass product holders who purchased 2020/2021 pass products;
and (iii) a decrease in inventories (excluding inventories assumed through acquisitions) as of July 31, 2021 as compared to the beginning of the fiscal year relative to an increase in the prior year period.
1 unchanged sentence
Cash used in investing activities for Fiscal 2021 decreased by $389.4 million, primarily due to cash payments of $327.6 million, net of cash acquired, related to the acquisition of Peak Resorts during Fiscal 2020.
−Removed: Additionally, capital expenditures decreased by $57.2 million primarily as a result of the deferral of a significant amount of discretionary capital projects related to the Company’s decision during the outbreak of COVID-19 to prioritize near-term liquidity.
−Removed: Cash provided by financing activities increased by $58.4 million during Fiscal 2021 compared to Fiscal 2020, primarily due to (i) proceeds of $575.0 million from the issuance of our 0.0% Convertible Notes during the Fiscal 2021;
+Added: Additionally, capital expenditures decreased by $57.2 million primarily as a result of the deferral of a significant amount of discretionary capital projects related to our decision during the outbreak of COVID-19 to prioritize near-term liquidity.
+Added: Cash provided by financing activities increased by $58.4 million during Fiscal 2021 compared to Fiscal 2020, primarily due to (i) proceeds of $575.0 million from the issuance of our 0.0% Convertible Notes during Fiscal 2021;
(ii) a decrease in dividends paid of $212.7 million;
1 unchanged sentence
and (iv) a decrease in repurchases of common stock of $46.4 million.
−Removed: These increases were partially offset by (i) proceeds of $600.0 million related to the issuance of our 6.25% Notes during Fiscal 2020;
+Added: These increases in cash provided by financing activities were partially offset by (i) proceeds of $600.0 million related to the issuance of our 6.25% Notes during Fiscal 2020;
(ii) proceeds of $335.6 million from incremental borrowings under the term loan portion of our Vail Holdings Credit Agreement during Fiscal 2020, which were used to fund the Peak Resorts acquisition;
1 unchanged sentence
and (iv) an increase in employee taxes paid for equity award exercises of $19.6 million.
−Removed: Fiscal 2020 compared to Fiscal 2019
−Removed: We generated $395.0 million of cash from operating activities during Fiscal 2020, a decrease of $239.3 million when compared to $634.2 million of cash generated during Fiscal 2019.
−Removed: The decrease in operating cash flows was primarily a result of decreased Mountain and Lodging segment operating results in Fiscal 2020, primarily due to the Resort Closures;
−Removed: a decrease in accounts payable and accrued liabilities due to declines associated with the Resort Closures (excluding accounts payable and accrued liabilities assumed through acquisitions) and an increase in cash interest payments of approximately $17.5 million primarily associated with debt assumed in the Peak Resorts acquisition and incremental term loan and revolver borrowings under our Vail Holdings Credit Agreement.
−Removed: These decreases were partially offset by increased North American pass product sales and receivable collections for the 2019/2020 North American ski season as compared to the prior year and a decrease in estimated tax payments of $23.1 million.
−Removed: Additionally we generated approximately $4.4 million of proceeds from real estate development land parcel sales in Fiscal 2020 compared to $0.1 million in proceeds from real estate development project closings that occurred in the prior year.
−Removed: Cash used in investing activities for Fiscal 2020 decreased by $103.3 million, primarily due to cash payments of $327.6 million, net of cash acquired, related to the acquisition of Peak Resorts during Fiscal 2020, as compared to cash payments of $419.0 million, net of cash acquired, related to the acquisitions of Triple Peaks, Stevens Pass, Falls Creek and Hotham during Fiscal 2019.
−Removed: Additionally, capital expenditures decreased by $19.7 million primarily as a result of actions associated with the deferral of discretionary capital projects related to the Company’s decision to prioritize near-term liquidity.
−Removed: Cash provided by financing activities increased by $475.8 million during Fiscal 2020 compared to Fiscal 2019, primarily due to (i) the $600.0 million issuance of the 6.25% Notes in Fiscal 2020;
−Removed: (ii) an increase in proceeds from incremental borrowings under the term loan portion of our Vail Holdings Credit Agreement from $265.5 million during Fiscal 2019, which were used to fund the Triple Peaks and Stevens Pass acquisitions, to $335.6 million during Fiscal 2020, which were used to fund the Peak Resorts acquisition;
−Removed: (iii) an increase in net borrowings under the revolver component of our Whistler Credit Agreement of $24.1 million, primarily relating to funds which were drawn as a precautionary measure in order to increase our cash position and financial flexibility in light of the financial market conditions resulting from the COVID-19 pandemic;
−Removed: (iv) a decrease in repurchases of common stock of $38.6 million;
−Removed: and (v) a decrease in dividend payments of $47.8 million associated with the Company’s decision to prioritize near-term liquidity.
−Removed: These increases in cash provided by financing activities were partially offset by (i) an increase in net payments on borrowings under the revolver component of our Vail Holdings Credit Agreement of $286.0 million;
−Removed: (ii) an increase in financing cost payments of $8.8 million, primarily associated with the issuance of the 6.25% Notes;
−Removed: and (iii) a payment for contingent consideration with regard to our lease for Park City.
Significant Sources of Cash
We had $1,107.4 million of cash and cash equivalents as of July 31, 2022, compared to $1,244.0 million as of July 31, 2021.
−Removed: Although we cannot predict the future impact associated with the COVID-19 pandemic on our business, we currently anticipate that our Mountain and Lodging segment operating results will continue to provide a significant source of future operating cash flows (primarily generated in our second and third fiscal quarters).
+Added: Although we cannot predict the future impact associated with the COVID-19 pandemic or other economic factors on our business, we currently anticipate that our Mountain and Lodging segment operating results will continue to provide a significant source of future operating cash flows.
In addition to our $1,107.4 million of cash and cash equivalents at July 31, 2022, we had $417.4 million available under the revolver component of our Vail Holdings Credit Agreement as of July 31, 2022 (which represents the total commitment of $500.0 million less certain letters of credit outstanding of $82.6 million).
−Removed: Also, to further support the liquidity needs of Whistler Blackcomb, we had C$243.1 million ($194.9 million) available under the revolver component of our Whistler Credit Agreement (which represents the total commitment of C$300.0 million ($240.5 million) less outstanding borrowings of C$56.0 million ($44.9 million) and a letter of credit outstanding of C$0.9 million ($0.7 million)).
+Added: Also, to further support the liquidity needs of Whistler Blackcomb, we had C$281.6 million ($220.0 million) available under the revolver component of our Whistler Credit Agreement (which represents the total commitment of C$300.0 million ($234.3 million) less outstanding borrowings of C$15.0 million ($11.6 million) and letters of credit outstanding of C$3.4 million ($2.6 million)).
We expect that our liquidity needs in the near term will be met by continued use of our existing cash and cash equivalents, operating cash flows and borrowings under both the Vail Holdings Credit Agreement and Whistler Credit Agreement, if needed.
−Removed: The Vail Holdings Credit Agreement and the Whistler Credit Agreement provide adequate flexibility and are priced favorably with any new borrowings currently priced at LIBOR plus 2.5% and Bankers Acceptance Rate plus 2.0%, respectively.
+Added: On August 31, 2022, we entered into an amendment of the Vail Holdings Credit Agreement, to extend the maturity date by two years to September 2026.
+Added: Additionally, in connection with the amendment the reference rate changed from LIBOR to the secured overnight financing rate (“SOFR”) given the anticipated sunset of LIBOR in June of 2023.
+Added: SOFR is a broad measure of the cost of borrowing cash in the overnight U.S.
+Added: Treasury repo market and is administered by the Federal Reserve Bank of New York.
+Added: There were no other material changes in terms.
+Added: The Vail Holdings Credit Agreement and the Whistler Credit Agreement provide adequate flexibility and are priced favorably with any new borrowings currently priced at SOFR, plus a spread of 0.1%, plus 1.25% for the Vail Holdings Credit Agreement, and Bankers Acceptance Rate plus 1.75% for the Whistler Credit Agreement.
Significant Uses of Cash
4 unchanged sentences
We evaluate additional discretionary capital improvements based on an expected level of return on investment.
−Removed: We currently anticipate we will spend approximately $115 million to $120 million on resort capital expenditures during calendar year 2021, excluding one-time items associated with integrations of $5 million and $12 million of reimbursable investments, as well as real estate related capital.
−Removed: Including these one-time items, we expect that our total capital plan will be approximately $135 million to $140 million.
−Removed: Included in these estimated capital expenditures are approximately $75 million to $80 million of maintenance capital expenditures, which are necessary to maintain appearance and level of service appropriate to our resort operations.
−Removed: Discretionary expenditures expected for calendar year 2021 include, among other projects, several investments which were previously deferred from calendar year 2020 as a result of COVID-19, including the 250-acre lift-served terrain expansion in the McCoy Park area of Beaver Creek;
−Removed: a new four-person high speed lift to serve Peak 7 at Breckenridge;
−Removed: replacing the Peru lift at Keystone with a six-person high speed chairlift;
−Removed: replacing the Peachtree lift at Crested Butte with a new three-person fixed-grip lift;
−Removed: and an upgrade of the four-person Quantum lift at Okemo with a six-person high speed chairlift, relocating the existing four-person Quantum lift to replace the Green Ridge three-person fixed-grip chairlift.
−Removed: We will also continue to invest in company-wide technology enhancements to support our data driven approach, guest experience
−Removed: and corporate infrastructure which improve our scalability and efficiency as we work to optimize our processes, business analytics and cost discipline across the network, as well as upgrades to the infrastructure of our guest contact centers.
+Added: We currently anticipate we will spend approximately $323 million to $333 million on resort capital expenditures during calendar year 2022.
+Added: This plan includes the installation of 18 new or replacement lifts across 12 of our resorts, which will meaningfully increase lift capacity at those lift locations.
+Added: The capital plan includes approximately $9 million for the addition of annual capital expenditures associated with the recently acquired Seven Springs Resorts, approximately $4 million related to the addition of Andermatt-Sedrun and approximately $20 million of incremental spending to complete the one-time capital plans associated with the Peak Resorts and Triple Peaks acquisitions.
+Added: Also included in these estimated capital expenditures are approximately $105 million to $115 million of maintenance capital expenditures, which are necessary to maintain appearance and level of service appropriate to our resort operations.
We currently plan to utilize cash on hand, borrowings available under our credit agreements and/or cash flow generated from future operations to provide the cash necessary to complete our capital plans.
Approximately $87 million was spent for capital expenditures in calendar year 2022 as of July 31, 2022, leaving approximately $236 million to $246 million to spend in the remainder of calendar year 2022.
+Added: On December 31, 2021, we acquired the assets of the Seven Springs Resorts for a purchase price of approximately $116.5 million, after adjustments for certain agreed-upon terms, which was funded with cash on hand.
+Added: On August 3, 2022, we acquired a majority stake in Andermatt-Sedrun Sport AG, for a purchase price of CHF 149.3 million ($155.7 million), which was funded with cash on hand.
+Added: During Fiscal 2022, we made a cash deposit of CHF 110.0 million ($114.4 million) to escrow as a required prepayment in connection with the acquisition, and the remaining CHF 39.3 million ($41.3 million) was paid subsequent to July 31, 2022.
+Added: As of August 3, 2022, the value of the total consideration paid to the seller was $155.4 million.
As of July 31, 2022, principal payments on the majority of our long-term debt ($2.7 billion of the total $2.8 billion debt outstanding as of July 31, 2022) are not due until fiscal year 2025 and beyond.
−Removed: As of July 31, 2021 and 2020, total long-term debt, net (including long-term debt due within one year) was $2,850.3 million and $2,450.8 million, respectively.
−Removed: Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents) decreased from $2,059.8 million as of July 31, 2020 to $1,606.3 million as of July 31, 2021, primarily as a result of cash provided by operating activities, as discussed above.
−Removed: See Notes to the Consolidated Financial Statements for additional information.
−Removed: On December 18, 2020, we entered into the Fourth Amendment to the Vail Holdings Credit Agreement.
−Removed: Pursuant to the Fourth Amendment, among other terms, we are exempt from complying with the Vail Holdings Credit Agreement’s maximum leverage ratio, maximum senior secured leverage ratio and minimum interest coverage ratio financial maintenance covenants for each of the fiscal quarters ending through January 31, 2022 (unless we make a one-time irrevocable election to terminate such exemption period prior to such date), after which we will again be required to comply with such covenants starting with the fiscal quarter ending April 30, 2022 (or such earlier fiscal quarter as elected by us).
−Removed: After the expiration of the Financial Covenants Temporary Waiver Period:
−Removed: • the maximum ratio permitted under the maximum leverage ratio financial maintenance covenant shall be 6.25 to 1.00;
−Removed: • the maximum ratio permitted under the senior secured leverage ratio financial maintenance covenant shall be 4.00 to 1.00;
−Removed: • the minimum ratio permitted under the minimum interest coverage ratio financial maintenance covenant will be 2.00 to 1.00.
−Removed: We are also prohibited from the following activities during the Financial Covenants Temporary Waiver Period (unless approval is obtained by a majority of the lenders under the Vail Holdings Credit Agreement):
−Removed: • paying any dividends or making share repurchases, unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) we have liquidity (as defined below) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter;
−Removed: • incurring indebtedness secured by the collateral under the Vail Holdings Credit Agreement in an amount in excess of $1.75 billion;
−Removed: • making certain non-ordinary course investments in similar businesses, joint ventures and unrestricted subsidiaries unless the Company has liquidity (as defined below) of at least $300.0 million.
−Removed: The Fourth Amendment also removed certain restrictions under the Financial Covenants Temporary Waiver Period, including (i) removing the restriction on acquisitions so long as we have liquidity (as defined below) of at least $300.0 million and (ii) removing the $200.0 million annual limit on capital expenditures.
−Removed: We are required to comply with a monthly minimum liquidity test (liquidity is defined as unrestricted cash and temporary cash investments of VRI and its restricted subsidiaries and available commitments under the Vail Holdings Credit Agreement revolver) of not less than $150.0 million, during the period that began July 31, 2020 and ending on the date we deliver a compliance certificate for the Company and its subsidiaries’ first fiscal quarter following the end of the Financial Covenants Temporary Waiver Period.
−Removed: During the Financial Covenants Temporary Waiver Period, borrowings under the Vail Holdings Credit Agreement, including the term loan facility, bear interest annually at LIBOR plus 2.50% and, for amounts in excess of $400.0 million, LIBOR is subject to a floor of 0.25% (which has decreased from the floor of 0.75% that was in effect prior to the Fourth Amendment).
−Removed: On December 18, 2020, we completed our offering of $575.0 million in aggregate principal amount of 0.0% Convertible Notes due 2026 in a private placement conducted pursuant to Rule 144A of the Securities Act.
−Removed: The 0.0% Convertible Notes were issued under an Indenture dated December 18, 2020 (the “Indenture”) between us and U.S.
−Removed: Bank National Association, as Trustee.
−Removed: The 0.0% Convertible Notes do not bear regular interest and the principal amount does not accrete.
−Removed: The 0.0% Convertible Notes mature on January 1, 2026, unless earlier repurchased, redeemed or converted.
−Removed: The 0.0% Convertible Notes are our general senior unsecured obligations.
−Removed: The 0.0% Convertible Notes rank senior in right of payment to any future debt that is expressly subordinated, equal in right of payment with our existing and future liabilities that are not so subordinated, and are subordinated to all of our existing and future secured debt to the extent of the value of the assets securing such debt.
−Removed: The 0.0% Convertible Notes will also be structurally subordinated to all of the existing and future liabilities and obligations of our subsidiaries, including such subsidiaries’ guarantees of the 6.25% Notes.
−Removed: The initial conversion rate was 2.4560 shares per $1,000 principal amount of notes (the “Conversion Rate”), which represents an initial conversion price of approximately $407.17 per share (the “Conversion Price”), and is subject to adjustment upon the occurrence of certain specified events as described in the Indenture.
−Removed: The principal amount of the 0.0% Convertible Notes is required to be settled in cash.
−Removed: We will settle conversions by paying cash, delivering shares of our common stock, or a combination of the two, at our option.
−Removed: Holders may convert their notes, at their option, only under the following circumstances:
−Removed: • during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 if the last reported sale price per share of our common stock exceeds 130% of the Conversion Price for each of at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter;
−Removed: • during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the “Measurement Period”) in which the trading price per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the Conversion Rate on such trading day;
−Removed: • upon the occurrence of certain corporate events or distributions on our common stock, as described in the Indenture;
−Removed: • if we call the 0.0% Convertible Notes for redemption;
−Removed: • at any time from, and including, July 1, 2025 until the close of business on the scheduled trading day immediately before the maturity date.
−Removed: The 0.0% Convertible Notes will be redeemable, in whole or in part, at our option at any time, and from time to time, on or after January 1, 2024 and on or before the 25th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the notes to be redeemed, plus accrued and unpaid special and additional interest, if any, to, but excluding, the redemption date, but only if the last reported sale price per share of our common stock exceeds 130% of the Conversion Price for a specified period of time.
−Removed: If we elect to redeem less than all of the 0.0% Convertible Notes, at least $50.0 million aggregate principal amount of notes must be outstanding and not subject to redemption as of the relevant redemption notice date.
−Removed: Calling any 0.0% Convertible Notes for redemption will constitute a make-whole fundamental change with respect to such notes, in which case the Conversion Rate applicable to the conversion of such notes will be increased in certain circumstances if such notes are converted after they are called for redemption.
−Removed: In addition, upon the occurrence of a fundamental change (as defined in the Indenture), holders of the 0.0% Convertible Notes may require us to repurchase all or a portion of their notes at a cash repurchase price equal to the principal amount of the notes to be repurchased, plus any accrued and unpaid special and additional interest, if any, to, but excluding, the applicable repurchase date.
−Removed: If certain fundamental changes referred to as make-whole fundamental changes (as defined in the Indenture) occur, the Conversion Rate for the 0.0% Convertible Notes may be increased for a specified period of time.
−Removed: The Indenture includes customary events of default, including failure to make payment, failure to comply with the obligations set forth in the Indenture, certain defaults on certain other indebtedness, and certain events of bankruptcy, insolvency or reorganization.
−Removed: We may elect, at our option, that the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will consist exclusively of the right of the holders of the 0.0% Convertible Notes to receive additional interest on the notes for up to 360 days following such failure.
+Added: As of July 31, 2022 and 2021, total long-term debt, net (including long-term debt due within one year) was $2.7 billion and $2.9 billion, respectively.
+Added: Net Debt (defined as long-term debt, net plus long-term debt due within one year less cash and cash equivalents) was $1.6 billion as of both July 31, 2022 and 2021.
As of July 31, 2022, the Vail Holdings Credit Agreement provides for (i) a revolving loan facility in an aggregate principal amount of $500.0 million and (ii) a term loan facility of $1.1 billion.
−Removed: We expect that our liquidity needs in the near term will be
−Removed: met by continued use of our existing cash and cash equivalents, operating cash flows and borrowings under the Vail Holdings Credit Agreement and the Whistler Credit Agreement, if needed.
+Added: We expect that our liquidity needs in the near term will be met by continued use of our existing cash and cash equivalents, operating cash flows and borrowings under the Vail Holdings Credit Agreement and the Whistler Credit Agreement, if needed.
Our debt service requirements can be impacted by changing interest rates as we had approximately $0.7 billion of net variable-rate debt outstanding as of July 31, 2022, after consideration of $400.0 million in interest rate swaps which convert variable-rate debt to fixed-rate debt.
−Removed: A 100-basis point change in LIBOR would cause our annual interest payments on our net variable-rate debt to change by approximately $8.4 million.
+Added: A 100-basis point change in LIBOR (or its successor, SOFR) would cause our annual interest payments on our net variable-rate debt to change by approximately $7.4 million.
Additionally, the annual payments associated with the financing of the Canyons transaction increase by the greater of CPI less 1%, or 2%.
1 unchanged sentence
Our long term liquidity needs depend upon operating results that impact the borrowing capacity under our credit agreements, which can be mitigated by adjustments to capital expenditures, the flexibility of investment activities and the ability to obtain favorable future financing.
−Removed: We can respond to liquidity impacts of changes in the business and economic environment, including the COVID-19 pandemic, by managing our capital expenditures, variable operating expenses, the timing of new real estate development activity and the payment of cash dividends on our common stock.
+Added: We can respond to liquidity impacts of changes in the business and economic environment, by managing our capital expenditures, variable operating expenses, the timing of new real estate development activity and the payment of cash dividends on our common stock.
+Added: Material Cash Requirements
+Added: As part of our ongoing operations, we enter into arrangements that obligate us to make future payments under contracts such as debt agreements and construction agreements in conjunction with our resort capital expenditures.
+Added: Debt obligations, which totaled $2.8 billion as of July 31, 2022, are recognized as liabilities in our Consolidated Balance Sheet.
+Added: Obligations under construction contracts and other purchase commitments are not recognized as liabilities in our Consolidated Balance Sheet until services and/or goods are received which is in accordance with GAAP.
+Added: A summary of our material cash requirements as of July 31, 2022 (excluding obligations presented elsewhere, including Notes to Consolidated Financial Statements) is presented below (in thousands):
+Added: Payments Due by Period
+Added: Fiscal 2-3 4-5 More than
+Added: Total 2023 years years 5 years
+Added: Long-term debt (1)
+Added: $ 3,164,858 152,598 1,748,777 630,925 632,558
+Added: Service contracts $ 26,507 24,800 1,288 419 —
+Added: Purchase obligations and other (2)
+Added: $ 698,358 597,847 77,411 — 23,100
+Added: Total contractual cash obligations $ 3,889,723 $ 775,245 $ 1,827,476 $ 631,344 $ 655,658
+Added: (1) Long-term debt includes principal payments, fixed-rate interest payments (including payments that are required under interest rate swaps) and estimated variable interest payments utilizing interest rates in effect at July 31, 2022, and assumes all debt outstanding as of July 31, 2022 will be held to maturity.
+Added: The future annual interest obligations noted herein are estimated only in relation to debt outstanding as of July 31, 2022, and do not reflect interest obligations on potential future debt or refinancing (including the impact of the Fifth Amendment, which we entered into in August 2022 and which extended the maturity date of our Vail Holdings Credit Agreement by two years to September 2026 (see Notes to Consolidated Financial Statements for additional information)).
+Added: Long-term debt also includes $12.8 million of proceeds resulting from real estate transactions accounted for as a financing arrangements.
+Added: Fiscal 2023 payments shown above include approximately $6.2 million of proceeds, which are expected to be recognized on the Company’s Statement of Operations during Fiscal 2023 as a result of the anticipated resolution of continuing involvement, with no associated cash outflow (see Notes to Consolidated Financial Statements for additional information).
+Added: (2) Purchase obligations and other primarily includes amounts which are classified as trade payables ($149.8 million), accrued payroll and benefits ($109.8 million), accrued fees and assessments ($25.7 million), contingent consideration liability ($42.4 million) and accrued taxes (including taxes for uncertain tax positions) ($87.5 million) on our Consolidated Balance Sheet as of July 31, 2022.
+Added: These amounts also include other commitments for goods and services not yet received, including construction contracts and minimum commitments under season pass alliance agreements, which are not included on our Consolidated Balance Sheet as of July 31, 2022 in accordance with GAAP.
+Added: Purchase obligations and other does not include any amounts associated with the acquisition of Andermatt-Sedrun, which was acquired on August 3, 2022.
Share Repurchase Program
Our share repurchase program is conducted under authorizations made from time to time by our Board of Directors.
−Removed: On March 6, 2006, our Board of Directors initially authorized the repurchase of up to 3,000,000 shares of Vail Resorts common stock (“Vail Shares”) and later authorized additional repurchases of up to 3,000,000 additional Vail Shares (July 16, 2008) and 1,500,000 Vail Shares (December 4, 2015), for a total authorization to repurchase shares of up to 7,500,000 Vail Shares.
−Removed: During Fiscal 2021, we did not repurchase any Vail Shares.
+Added: On March 6, 2006, our Board of Directors initially authorized the repurchase of up to 3,000,000 shares of Vail Shares and later authorized additional repurchases of up to 3,000,000 additional Vail Shares (July 16, 2008) and 1,500,000 Vail Shares (December 4, 2015), for a total authorization to repurchase shares of up to 7,500,000 Vail Shares.
+Added: During Fiscal 2022, we repurchased 304,567 shares of common stock at an average price of $246.27 for a total cost of $75.0 million.
Since the inception of this stock repurchase program through July 31, 2022, we have repurchased 6,465,708 Vail Shares at a cost of approximately $479.4 million.
As of July 31, 2022, 1,034,292 Vail Shares remained available to repurchase under the existing repurchase authorization.
−Removed: Pursuant to the Third Amendment and as discussed above, we are prohibited from repurchasing shares of common stock during the Financial Covenants Temporary Waiver Period unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined above) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter.
−Removed: Vail Shares purchased pursuant to the repurchase program will be held as treasury shares and may be used for the issuance of shares under the Company’s share award plan.
+Added: Vail Shares purchased pursuant to the repurchase program will be held as treasury shares and may be used for the issuance of shares under our share award plan.
Repurchases under the program may be made from time to time at prevailing prices as permitted by applicable laws, and subject to market conditions and other factors.
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Dividend Payments
−Removed: We announced on April 1, 2020 that we would be suspending the declaration of our quarterly dividend in response to the COVID-19 pandemic.
−Removed: Additionally, pursuant to the Fourth Amendment, we are prohibited from paying any dividends during the Financial Covenants Temporary Waiver Period unless (x) no default or potential default exists under the Vail Holdings Credit Agreement and (y) the Company has liquidity (as defined above) of at least $300.0 million, and the aggregate amount of dividends paid and share repurchases made by the Company during the Financial Covenants Temporary Waiver Period may not exceed $38.2 million in any fiscal quarter.
−Removed: During Fiscal 2021, we did not pay cash dividends.
+Added: During Fiscal 2022, we paid cash dividends of $5.58 per share ($225.8 million, including cash dividends paid to Exchangeco shareholders).
+Added: We did not pay cash dividends during Fiscal 2021.
On September 22, 2022, our Board of Directors approved a cash dividend of $1.91 per share payable on October 24, 2022 to stockholders of record as of October 5, 2022.
−Removed: Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on October 22, 2021 to the shareholders of record as of October 5, 2021.
−Removed: We expect to fund the dividend with available cash on hand and will do so pursuant to the restrictions under the Financial Covenants Temporary Waiver Period.
+Added: We expect to fund the dividend with available cash on hand.
The amount, if any, of dividends to be paid in the future will depend on our available cash on hand, anticipated cash needs, overall financial condition, restrictions contained in our Vail Holdings Credit Agreement, future prospects for earnings and cash flows, as well as other factors considered relevant by our Board of Directors.
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Our borrowing availability under the Whistler Credit Agreement is primarily determined based on the commitment size of the credit facility and our compliance with the terms of the Whistler Credit Agreement.
−Removed: Pursuant to the Fourth Amendment and as discussed above in further detail, we are exempt from complying with the restrictive financial covenants of the Vail Holdings Credit Agreement during the Financial Covenants Temporary Waiver Period, but are required to comply with a monthly minimum liquidity test during such period (as discussed above).
We were in compliance with all restrictive financial covenants in our debt instruments as of July 31, 2022.
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There can be no assurance that such waiver or amendment would be granted, which could have a material adverse impact on our liquidity.
−Removed: Contractual Obligations
−Removed: As part of our ongoing operations, we enter into arrangements that obligate us to make future payments under contracts such as debt agreements, lease agreements and construction agreements in conjunction with our resort capital expenditures.
−Removed: Debt obligations, which totaled $2.9 billion as of July 31, 2021, are recognized as liabilities in our Consolidated Balance Sheet.
−Removed: Obligations under construction contracts and other purchase commitments are not recognized as liabilities in our Consolidated Balance Sheet until services and/or goods are received which is in accordance with GAAP.
−Removed: A summary of our contractual obligations as of July 31, 2021 is presented below (in thousands):
−Removed: Payments Due by Period
−Removed: Fiscal 2-3 4-5 More than
−Removed: Contractual Obligations Total 2022 years years 5 years
−Removed: Long-Term Debt (Outstanding Principal) (1)
−Removed: $ 2,948,514 $ 121,345 $ 127,538 $ 2,174,189 $ 525,442
−Removed: Fixed Rate Interest (1)
−Removed: 350,352 56,388 112,873 57,790 123,301
−Removed: Canyons Obligation (2)
−Removed: 1,543,186 30,093 62,003 64,508 1,386,582
−Removed: Operating Leases and Service Contracts (3)
−Removed: 321,653 68,273 79,521 64,796 109,063
−Removed: Purchase Obligations and Other (4)
−Removed: 538,284 434,269 80,903 12 23,100
−Removed: Total Contractual Cash Obligations $ 5,701,989 $ 710,368 $ 462,838 $ 2,361,295 $ 2,167,488
−Removed: (1) The fixed-rate interest payments (including payments that are required under interest rate swaps that we have entered into) as well as long-term debt payments, included in the table above, assume that all debt outstanding as of July 31, 2020 will be held to maturity.
−Removed: Interest payments associated with variable-rate debt have not been included in the table.
−Removed: Assuming that our approximately $0.8 billion of variable-rate long-term debt as of July 31, 2021 is held to maturity and utilizing interest rates in effect at July 31, 2021, our annual interest payments (including commitment fees and letter of credit fees) on variable rate long-term debt as of July 31, 2021 is anticipated to be approximately $23.6 million for Fiscal 2022, approximately $21.9 million for fiscal year 2023 and approximately $10.4 million for at least each of the next three years subsequent to fiscal year 2023.
−Removed: The future annual interest obligations noted herein are estimated only in relation to debt outstanding as of July 31, 2021 and do not reflect interest obligations on potential future debt.
−Removed: Included in Long-Term Debt (Outstanding Principal) are $11.7 million of proceeds resulting from real estate transactions accounted for as a financing arrangements.
−Removed: Fiscal 2022 payments shown above include approximately $6.2 million of proceeds, which are expected to be recognized on the Company’s Statement of Operations during Fiscal 2022 as a result of
−Removed: the anticipated resolution of continuing involvement, with no associated cash outflow (see Notes to Consolidated Financial Statements for additional information).
−Removed: (2) Reflects interest expense payments associated with the remaining lease term of the Canyons obligation, initially 50 years, assuming a 2% per annum (floor) increase in payments.
−Removed: Any potential increases to the annual fixed payment above the 2% floor due to inflation linked index of CPI less 1% have been excluded.
−Removed: (3) The payments under noncancelable operating leases included in the table above reflect the applicable minimum lease payments and exclude any potential contingent rent payments.
−Removed: (4) Purchase obligations and other primarily include amounts which are classified as trade payables ($98.3 million), accrued payroll and benefits ($101.7 million), accrued fees and assessments ($21.2 million), contingent consideration liability ($29.6 million), and accrued taxes (including taxes for uncertain tax positions) ($123.6 million) on our Consolidated Balance Sheet as of July 31, 2021;
−Removed: and, other commitments for goods and services not yet received, including construction contracts and minimum commitments under season pass alliance agreements, not included on our Consolidated Balance Sheet as of July 31, 2021 in accordance with GAAP.
Off Balance Sheet Arrangements
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If it is determined, based on qualitative factors, that the fair value of the reporting unit or indefinite-lived intangible asset may be more likely than not less than carrying amount, or if significant changes to macro-economic factors related to the reporting unit or intangible asset have occurred that could materially impact fair value since the previous quantitative analysis was performed, a quantitative impairment test would be required, in which we would determine the estimated fair value of our reporting units using a discounted cash flow analysis and determine the estimated fair value of indefinite-lived intangible assets primarily using the income approach based upon estimated future revenue streams.
−Removed: These analyses require significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, available industry/market data (to the extent available), estimation of the long-term rate of growth for our business including expectations and assumptions regarding the impact of general economic conditions on our business, estimation of the useful life over which cash flows will occur (including terminal multiples), determination of the respective weighted average cost of
−Removed: capital and market participant assumptions.
+Added: These analyses require significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, available industry/market data (to the extent available), estimation of the long-term rate of growth for our business including expectations and assumptions regarding the impact of general economic conditions on our business, estimation of the useful life over which cash flows will occur (including terminal multiples), determination of the respective weighted average cost of capital and market participant assumptions.
Changes in these estimates and assumptions could materially affect the determination of estimated fair value and impairment for each reporting unit or indefinite-lived intangible asset.
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otherwise, no impairment loss is recognized.
−Removed: During Fiscal 2021, we performed quantitative analyses of our reporting units and indefinite-lived intangible assets and determined that the estimated fair value of all material reporting units and indefinite-lived intangible assets significantly exceeded their respective carrying values.
+Added: During Fiscal 2022, we primarily performed qualitative analyses of our reporting units and indefinite-lived intangible assets and determined that the estimated fair value of all material reporting units and indefinite-lived intangible assets significantly exceeded their respective carrying values.
Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors.
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(1) prolonged adverse weather conditions resulting in a sustained decline in guest visitation;
−Removed: (2) a prolonged weakness in the general economic conditions in which guest visitation and spending is adversely impacted (particularly with regard to the ongoing COVID-19 pandemic);
+Added: (2) a prolonged weakness in the general economic conditions in which guest visitation and spending is adversely impacted (particularly with regard to COVID-19 or other potential future pandemics);
and (3) volatility in the equity and debt markets which could result in a higher discount rate.
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We believe the estimates and judgments discussed herein are reasonable and we have adequate reserves for our tax contingencies for uncertain tax positions.
−Removed: Our reserves for uncertain tax positions, including any income tax related interest and penalties ($74.8 million as of July 31, 2021), relate to the treatment of the Canyons lease payments obligation as payments of debt obligations and that the tax basis in Canyons goodwill is deductible.
+Added: Our reserves for uncertain tax positions, including any income tax related interest and penalties, are $68.8 million as of July 31, 2022.
+Added: This reserve relates to the treatment of the Canyons lease payments obligation as payments of debt obligations and that the tax basis in Canyons goodwill is deductible.
Actual results could differ and we may be exposed to increases or decreases in those reserves and tax provisions that could be material.
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Although we believe the assumptions and estimates we have made in the past have been reasonable and appropriate, they are based in part on historical experience and information obtained from the management of the acquired companies and are inherently uncertain.
−Removed: Examples of critical estimates in valuing certain of the intangible assets we have acquired include but are not limited to determination of weighted average cost of capital, market participant assumptions, royalty rates, terminal multiples and estimates of future cash flows to be generated by the acquired assets.
+Added: Examples of critical estimates in valuing certain of the intangible assets we have acquired include, but are not limited to:
+Added: determination of weighted average cost of capital, market participant assumptions, royalty rates, terminal multiples and estimates of future cash flows to be generated by the acquired assets.
In addition to the estimates and assumptions applied to valuing intangible assets acquired, the determination of the estimated fair value of contingent consideration, including estimating the likelihood and timing of achieving the relevant thresholds for contingent consideration payments, requires the use of subjective judgments.
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Seasonality and Quarterly Results
−Removed: Our mountain and lodging operations are seasonal in nature.
+Added: Our mountain and lodging operations are seasonal in nature, with a typical peak operating season in North America generally beginning in mid-December and running through mid-April.
In particular, revenue and profits for our North America mountain and most of our lodging operations are substantially lower and historically result in losses from late spring to late fall.
−Removed: Conversely, peak operating seasons for our NPS concessionaire properties, our mountain resort golf courses and our Australian resorts’ ski season generally occur during the North American summer months while the North American winter months result in operating losses.
−Removed: Revenue and profits generated by NPS concessionaire properties summer operations, golf operations and Australian resorts’ ski operations are not sufficient to fully offset our off-season losses from our North American mountain and other lodging operations.
+Added: Conversely, peak operating seasons for our NPS concessioner properties, our mountain resort golf courses and our Australian resorts’ ski season generally occur during the North American summer months while the North American winter months result in operating losses.
+Added: Revenue and profits generated by NPS concessioner properties’ summer operations, golf operations and Australian resorts’ ski operations are not sufficient to fully offset our off-season losses from our North American mountain and other lodging operations.
During Fiscal 2022, approximately 83% of total combined Mountain and Lodging segment net revenue (excluding Lodging segment revenue associated with reimbursement of payroll costs) was earned during the second and third fiscal quarters.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.