Intrawest reports strong performance for Colorado, Steamboat
May 13, 2014
Steamboat Springs — Steamboat Ski Area and Winter Park outperformed the rest of the Colorado mountain resort industry, according to Intrawest's third-quarter earnings call.
The two Intrawest resorts consolidated their market shares, CEO Bill Jensen said during the call, seeing a 10.3 percent increase in skier visits for the period from Nov. 30, 2013 to April 30, while the average for Colorado resorts was a 6.4 increase.
"It was the success of our frequency and season pass growth both nationally and within the state of Colorado," Jensen said. "But also our destination business was strong."
The playing field was level as far as snow was concerned in Colorado, he said, but the low snow totals experienced on the West Coast could have had an impact.
Jensen noted that Steamboat has added direct flights from Seattle and Los Angeles in the past two years.
"It helps to have that 100-plus seats arriving at the local airport almost on a daily basis," he said.
Intrawest continues to explore ways to improve costs, Jensen said, and to seek strong returns on invested capital.
The Four Points Lodge restaurant at Steamboat "financially exceeded expectations while providing a significant upgrade" to the guest experience, Jensen said.
Intrawest is looking to replicate the results, starting with a new on-mountain restaurant at Winter Park, which should seat between 400 to 450 people when finished.
"It has the ability to perform very well from a food and beverage standpoint and drive increased visits to Winter Park," Jensen said.
The approximately $21 million of capital expenditure in the previous fiscal year was dedicated to maintenance while the $36.9 million spent so far this year has included a number of major projects, including the Four Points Lodge and night skiing at Steamboat.
Intrawest also is making "small but important investments" to the summer side of its business, Jensen said.
Winter Park now does about $1 million each summer in earnings before interest, taxes, depreciation and amortization, and Intrawest is looking to copy that success at Steamboat and Snowshoe Mountain Resort in West Virginia.
Intrawest also indicated it's still interested in making acquisitions.
According to documents included in the presentation, less than 10 percent of North America's ski resorts are owned by multi-resort owners or operators. There also are opportunities outside of North America, the document states, as skiing gains popularity in parts of Asia.
The recent transactions involving Taos Ski Valley and Snowbird were not widely shopped, according to Jensen, but a generational shift where original owners or founders start to sell is occurring and is expected to continue.
"We're pursuing multiple opportunities, but it's too early for any detail," Jensen said.
Overall, Intrawest's bottom line across segments was bolstered by the debt restructuring that occurred before the company's initial public offering but was hurt by a weak Canadian dollar.
Net income was $108.9 million for the quarter compared to $62.1 million for the same period during the previous year, but the company expects to be essentially flat for the full year because of increased costs.