SAM Magazine—Broomfield, Colo., Sept. 29, 2023—Vail Resorts (VR) reported a drop in full-year net income for fiscal 2023, EBITDA that was essentially flat, and an increase in season-to-date pass sales for the 2023-24 season. VR's fiscal year ended on July 31.

Key info in the year-end report, for the fiscal year ended July 31:

Net income was down to $268.1 million for fiscal 2023, compared to $347.9 million for fiscal 2022. Gross revenue rose by more than $350 million, to nearly $3 billion, but expenses rose just as much, fueled largely by VR’s wage increases and increased staffing levels. The reduction in net income was primarily due to a reduction in the gain on disposal of fixed assets—VR sold several properties in fiscal 2022—and an increase in fiscal 2023 expense "associated with a change in the estimated fair value of the contingent consideration liability related to our Park City resort lease," said the company's quarterly statement.

EBITDA was flat, $834.8 million for fiscal 2023, compared to $836.9 million for fiscal 2022.

Skier/rider visits. VR recorded 19.4 million skier/rider visits for the 2022-23 season, up 12 percent. Some of the increase in visits stemmed from adding resorts in the past year—Seven Springs and Andermatt-Sedrun, for example. Approximately 75 percent of skier visitation in North America, excluding complimentary visits, was from passholders, up from approximately 72 percent for 2021-22.

Ticket revenue per visit was $73.20, down 3.4 percent from prior year, as passholders visited more frequently than in the prior season. Overall, lift revenue rose 8.4 percent.

Ancillary business, from snowsports school to dining, saw large increases compared to the prior Covid-limited season. Ski school revenue increased 28.5 percent, dining revenue increased 37.2 percent, and retail/rental revenue rose 15.9 percent, "each primarily driven by the greater impact of Covid-19 and related limitations and restrictions in the prior year," according to the quarterly statement. 

During the analysts' call, VR CEO Kirsten Lynch said that VR expects these ancillary revenue streams will continue to grow, especially F&B, which still wasn't back to pre-Covid levels last season.

2023-24 Outlook: Pass product sales through Sept. 22, 2023 for the upcoming 2023-24 North American ski season increased approximately 7 percent in units and approximately 11 percent in sales dollars compared to year-earlier totals.

Lynch said that sales were up in all regions and in all categories of pass products, from local area passes to Epic Day passes. Unit growth was strongest in destination markets, including in the Northeast, and in regional pass products and Epic Day Pass products. Sales dollars benefited from an 8 percent price increase, partially offset by the growth of Epic Day Pass sales. Lynch added that VR saw strong growth among new passholders, including lapsed passholders.

VR's guidance for fiscal 2024 is for net income between $316 million and $394 million, and EBITDA to be between $912 million and $968 million. At the mid-point of these projections, VR would see a 31 percent margin, up from 29 percent for fiscal 2023.

On the analysts' call, Lynch said that "workforce management" (think tighter control on staffing levels and hours) and greater use of technology would enable margin growth in the future, along with further increases in ancillary revenues.