ASC shows loss |

ASC shows loss

Despite a steep fiscal-year loss announced Monday, American Skiing Co. investors may have a diamond in the rough once its major resort construction projects level out the debt ratio.

To defray some of the slippery earnings, part of that promise lies in ASC’s eight-passenger, $30 million gondola project at Heavenly which is due to open Dec. 21 off U.S. Highway 50 at Park Avenue, along with other resort investments that drained capital last year.

The period, ending July 30, amounted to $52.5 million in net losses. This is up from $32.3 million for fiscal year 1999. Down 6 cents, shares in the company closed at $2.06 Monday.

Resort revenue came in at $292.1 million compared with $292.6 million in the previous fiscal year. More telling, real estate revenue amounted to $132.1 million vs. $24.5 million the year before.

“In this business, you’re likely to experience ebbs and flows from quarter to quarter as new projects come on line. … Our goal is reducing our real estate debt. And the (Grand Summit Resort Hotel) at Heavenly is our next priority,” said Skip King, spokesman for ASC.

The publicly held company based in Newry, Maine, operates nine resorts including Steamboat, Colo., Killington, Vt., and Heavenly – South Shore’s largest ski resort.

American, along with ski area conglomerates Intrawest Corp. and Vail Resorts, has endured a string of lackluster winters prompted by the weather phenomenons El Nino and La Nina.

Indeed, the weather may also serve as the great white hope for shareholders.

“Although the past two ski seasons were disappointing because of unfavorable weather, we look to the upcoming ski season with a new level of confidence for both our resort and real estate businesses,” Chairman and Chief Executive Officer Leslie Otten said in an issued statement. “Since the end of this past ski season, we have been busy taking corrective action and re-evaluating our strategy.”

Construction cost over-runs have added to the mounting debt, ASC management mentioned.

“We are committed to selling down our real estate inventory and reducing our real estate debt levels by at least $40 million prior to starting any new projects this spring,” the statement adds.

As of year-end, the Grand Summit at the Canyons in Utah was 52 percent sold out. King declined to disclose presales figures for Heavenly’s resort hotel.

“Clearly, it’s a product people are interested in,” he said.

Looking ahead to 2001, the company expects to increase skier visits and resort per capita spending by 5 to 7 percent.

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