Tuesday, October 17, 2000
Steamboat Springs American Skiing Co. Chairman Les Otten said this week that improved performance by the company's real estate division is the key to reversing disappointing revenue performance in fiscal year 2000 that led to ASC reporting a $52.5 million loss this week.
"We're disappointed with our results for last year," Otten said during a conference call with industry analysts.
ASC's chief financial officer, Mark Miller, said last year's disappointing fiscal performance was related in large part to "an extraordinary loss related to the write-off of deferred financing costs" associated with the $150 million investment in ASC by Oak Hill Partnership. That investment closed in August 1999.
Delays in opening a hotel in Utah from December 1999 until February 2000, plus delays in opening the Steamboat Grand also affected the revenue picture, Miller said.
And warm weather and lack of snow that prevailed throughout much of the nation last year hurt revenues on the resort side.
Otten said the publicly held company will rely on increased sales at the Steamboat Grand Hotel and other new resort properties at the Canyons in Utah, as well as ski season occupancy, to help turn American Skiing's profit picture around.
Otten said almost 70 percent of the available quartershares at the Steamboat Grand remain unsold.
He also predicted that ongoing developments at the Canyons, including luxury townhomes now under construction and selling for more than $1 million apiece, combined with the Steamboat Grand, could generate more than $150 million in sales revenue over the next two to three years.
"We've spent a great deal of time preparing for the winter season and are confident that we can sell existing inventory at a rapid rate," Otten said. "To ensure that we reach our goal, we have reorganized our real estate company."
In recent months, ASC has created the new position of chief operating officer of American Skiing Co. Resort Properties (it's real estate company) and hired Hernan Martinez to fill the post. He has extensive experience with developments in Latin America, according to ASC spokesman Skip King.
Additionally, Senior Vice President Scott Oldakowski of ASC Resort Properties will be moving from the Canyons to spend the winter in Steamboat, Otten said. King said Oldakowski is not replacing anyone locally.
Miller estimated that over a sell-out period of two to three years, ASC still needs to sell $85 million to $90 million of quartershares at the Steamboat Grand.
King said Oldakowski has been with ASC and involved in quartershare sales since the company built its first hotel at Sunday River, Maine.
American Skiing reported net losses to common shareholders for fiscal 2000 of $52.5 million or $1.73 per diluted share on 30.4 million shares. That compares to losses of $32.2 million, or $1.07 per share in fiscal 1999.
The losses came despite an increase in total revenues of more than $100 million.
To reach Tom Ross call 871-4210 or e-mail firstname.lastname@example.org