ASC gives earnings snapshot

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The Steamboat Ski Area had recorded 429,017 skier and snowboarder visits season-to-date as of Jan. 30. However, comparisons with last season are difficult.

American Skiing Company, parent of the Steamboat Ski Area, gave a snapshot of the early portion of this ski season recently when it released financial results for the second fiscal quarter of 2005.

However, fiscal 2005 is a week longer than fiscal 2004 was, and that means ASC's seven ski areas, Steamboat among them, enjoyed five more days of doing business in the fiscal quarter that just ended.

ASC officials acknowledged this week that, overall, its resorts had about 3 percent fewer ski visits than last year, when the five-day discrepancy is factored in. However, the company did not apply the same analysis to individual ski areas such as Steamboat.

ASC totaled 1.69 million skier days season-to-date as of Jan. 30. The company attributed the early-season dip in skier visits to low amounts of natural snowfall and warm temperatures in the East.

However, Kill-ington, Vt., edged Steamboat for the lead in skier visits through Jan. 30, with 430,801. New England received abundant snowfall in February and March, and company CEO B.J. Fair said he's cautiously optimistic that the ski season will finish strong.

"We are reaping the benefits of superb recent natural snowfall in the Northeast," Fair said. He added that ASC's All For One season pass in New England has brought new business to the company.

ASC's consolidated revenue was $106 million for the 14 weeks that ended Jan. 30 compared with $103 million for the 13 weeks that ended Jan. 25, 2004. ASC reported that revenue associated with the additional week of doing business was $11.6 million, indicating that on an adjusted basis, company revenues were down early this ski season.

The company reported a net loss of $59.9 million for the 27 weeks that ended Jan. 30 compared with a net loss of $62.9 million for the 26 weeks that ended Jan. 25, 2004.

ASC informed the Securities and Exchange Commission that it does not expect to make Thursday's deadline to reduce the balance of $16.9 million on its senior construction loan for its Grand Summit hotels to $14 million. The company's agreement with its creditors, principally Textron Financial, calls for it to reduce the debt to $12 million by June 30 and $11 million by Sept. 30. The construction debt is due to be retired by June 30, 2006.

ASC is paying as much as 20 percent interest on portions of the $16.9 million.

Company spokesman David Hirasawa said Thursday that ASC would ask its creditors for a waiver on the terms of its senior construction loan.

In its report to the SEC, ASC officials wrote: "Although the company has recently experienced increases in sales activities as the Steamboat (Grand Resort Hotel), without a significant sales increase in the next several weeks, the company does not anticipate that it will meet the March 31 requirement for reduction of the senior construction loan principal to $14 million. Similarly, sales volume will need to significantly increase through the next two months in order for the company to meet the $12 million maximum balance amount on June 30."

ASC is obligated to retire a fraction of the construction loan principal every time it closes on a sale at the Steamboat Grand in an amount that is between 70 and 80 percent of the net proceeds of each closing.

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