Heavenly Ski owner posts 67 percent earnings drop for quarter
NEWRY, Maine (AP) – American Skiing Co. on Wednesday posted a 66.5 percent drop in net earnings for the third quarter despite increased skier visits and per-skier revenue.
The Newry-based company that owns Heavenly Ski Resort earned $7.2 million, or 19 cents per diluted share, in the three months ended April 29, compared to $21.5 million, or 42 cents per diluted share, in the same period a year ago.
”Excluding nonrecurring charges, the company’s resort operations showed significant improvement over the prior year,” said Mark Miller, the company’s chief financial officer
Skier visits were up five percent, and the revenue generated by each skier was up because of increased lodging at two of its resorts, higher yields on lift tickets and improved retail and refreshment operations, Miller said.
Nonrecurring charges cited for the third quarter include a $3.6 million loss related to its withdrawn merger plan with MeriStar Hotel and Resorts, $2.1 million in employee severance and restructuring charges related to reorganization efforts and $0.8 million on the sale of its interest in the Heavenly Grand Summit Hotel development subsidiary in California.
The company said it will reverse the income tax benefits of $13.7 million recognized in the first two quarters of the fiscal year and does not expect to recognize any income tax expense or benefit in the foreseeable future.
The company announced on May 30 that it plans to sell its Steamboat resort in Colorado and cut jobs under a restructuring designed to reduce its debt load and operating costs.
”Substantial progress has been made on negotiating amendments to our key debt facilities and securing an additional capital infusion,” said William ”B.J.” Fair, who became the company’s chief executive officer in March. ”Our management team is squarely focused on reducing debt, improving financial flexibility and simultaneously creating efficiencies at every level of the organization.”
Revenues for the third quarter totaled $179.6 million, down from $223.1 million for the same period last year. Resort revenue was $164.2 million for the quarter, down from $149.9 for the same period last year. Real estate revenue was $15.4 million, compared to $73.2 million last year.
Total earnings before interest, taxes, depreciation and amortization were $57.8 million for the quarter, down from $71.7 million for the same period last year.
After adjusting for nonrecurring charges, resort earnings increased $2 million from the same period the previous year to $64.6 million, the company said.
American Skiing is the nation’s largest ski and snowboard resort operators. Its resorts include Killington, Mount Snow and Sugarbush in Vermont; Sunday River and Sugarloaf/USA in Maine; Attitash Bear Peak in New Hampshire; Steamboat in Colorado, The Canyons in Utah and Heavenly in California and Nevada.
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