Is Vail group financially secure?

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Sentinel

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That last area is now super sweet after fresh snow; at least for an hour or so anyway. Just the right mix of trees and open areas wide enough to be safe. Would hate it if it was ever groomed; just wrong.

But that's precisely the problem. Before they cleared the trees, the fresh snow used to last for several hours. Now it gets tracked out far more quickly.

Sure, it's "super sweet" if you're there first, but like any sugar hit, it won't give you any lasting satisfaction.
 

Bato

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I remember driving through Andermatt one day in the Autumn, seemed like it was in the middle of nowhere and my Swiss mate said apart from skiing it was a very boring place.
Im sure theres a lot of rusted on red neck farmers who are their main staff in the winter. Any change wont come easily.
 

rowdyflat

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In principle huge companies too big to fail are a problem world wide for governments and become part of a monopoly system .
They effectively become more powerful than any country can handle. eg Crown casino , CBA bank, Google Microsoft, Monsanto .
The EU seem to be the only ones that have the guts to take them on.
This is why I oppose Vail.
 

CarveMan

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In principle huge companies too big to fail are a problem world wide for governments and become part of a monopoly system .
They effectively become more powerful than any country can handle. eg Crown casino , CBA bank, Google Microsoft, Monsanto .
The EU seem to be the only ones that have the guts to take them on.
This is why I oppose Vail.
The EU won't even need to take on Vail. That will happen at a much more grassroots level.

Apparently the ski school they have acquired in Andermatt is a crappy one, and the hotel they have acquired gets its instructors from the good ski school my mate works for, and has blackbanned instructors from the crappy one.

Entrenched stuff like that will make their head explode. I don't have much inside goss from Vail in Australia but when Merlin took over Hotham I did know that they couldn't deal with how little control they had in terms of the RMB and 3rd party accomm etc, they were used to managing the entire experience, and Vail will be up against far more in Europe.

The Compagnie des Alpes is a mega conglomerate of ski resorts in Europe but they don't do the season pass thing or a lot of the other crappy things that Vail does.
 

dawooduck

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Telemark Phat

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The EU won't even need to take on Vail. That will happen at a much more grassroots level.

Apparently the ski school they have acquired in Andermatt is a crappy one, and the hotel they have acquired gets its instructors from the good ski school my mate works for, and has blackbanned instructors from the crappy one.

Entrenched stuff like that will make their head explode. I don't have much inside goss from Vail in Australia but when Merlin took over Hotham I did know that they couldn't deal with how little control they had in terms of the RMB and 3rd party accomm etc, they were used to managing the entire experience, and Vail will be up against far more in Europe.

The Compagnie des Alpes is a mega conglomerate of ski resorts in Europe but they don't do the season pass thing or a lot of the other crappy things that Vail does.
Vail Australia is Perisher. They're used to not managing the whole experience.
 

sly_karma

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The EU won't even need to take on Vail. That will happen at a much more grassroots level.

Apparently the ski school they have acquired in Andermatt is a crappy one, and the hotel they have acquired gets its instructors from the good ski school my mate works for, and has blackbanned instructors from the crappy one.

Entrenched stuff like that will make their head explode.

This. So much this.
 
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Nidecker

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Apparently a Vail representative is coming to meet my mate's ski school director tomorrow. They are all wondering if there will be an offer to buy it.

More than one way to skin a cat. :) Not that it will necessarily be an easy ride for Vail, but I'm sure they have half an idea of what they are getting into.

Their choice of this particular ski are could be strategic.

They also probably have deeper pockets than those who might seek to disrupt, they may just simply outlast the disruption.

Just thoughts, who knows....
 
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CarveMan

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Their choice of this particular ski are could be strategic.
From memory, Andermatt has had a rapid, recent & substantial expansion with outside cash from an Egyptian (???) investor, so this probably means that the operations aren't as disparate as a more traditional resort that has evolved over time with a lot of entrenched private businesses being major parts of the experience. So in this case their investment in Andermatt gives them control of a lot of things that they are accustomed to controlling and more so than in other resorts.
 
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Hully

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At Falls, apart from retail and rental, Vail do not have the vertical integration that they are used to with their North American resorts. Harking back to Katz's statement when they first purchased Perisher is that what they were buying was inbound visitation to their NA resorts, I think that they obviously want to ensure that the Australian resorts return standalone profits, which they do, but their measure of success with their Australian venture is visitation by EPIC Australia Pass holders to their North American resorts. Resorts where their vertical integration ensures high yield of dollar spend.
 

SnowRabbit

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At Falls, apart from retail and rental, Vail do not have the vertical integration that they are used to with their North American resorts. Harking back to Katz's statement when they first purchased Perisher is that what they were buying was inbound visitation to their NA resorts, I think that they obviously want to ensure that the Australian resorts return standalone profits, which they do, but their measure of success with their Australian venture is visitation by EPIC Australia Pass holders to their North American resorts. Resorts where their vertical integration ensures high yield of dollar spend.
They wouldn't like me then. I've been an EPIC Pass buyer since their inception and I've never used it OS or even considered it when making decisions on where to ski OS. And now that I'm over 70 I won't be buying it to use in Oz. An Over 70s Perisher Season Pass will do me.
And OS lift tickets will be purchased separately wherever required.
Not everyone's point of view of course.
 
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Hully

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They wouldn't like me then. I've been an EPIC Pass buyer since their inception and I've never used it OS or even considered it when making decisions on where to ski OS. And now that I'm over 70 I won't be buying it to use in Oz. An Over 70s Perisher Season Pass will do me.
And OS lift tickets will be purchased separately wherever required.
Not everyone's point of view of course.
I'm the same. I get an EPIC Pass because it is the cheapest way to ski Falls, my local hill. I've used it a few times over at Hotham and it doesnt influence where I ski when I go to Japan. I am also not a 'high yield' customer owning all my equipment, which I get through independent businesses, take the majority of my food with me and ski from my home. Apart from lift pass the only significant resort spend is instruction/coaching for my now 12yo.
What I am talking about isn't you or I but the more typical 'ski tourist'.
 

BlueHue

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No, that area wasn't burnt, and it's not a fire break.

What I'm referring to is the spur between the valley that Interceptor is in and Pretty Valley. The whole spur used to be covered in snowgums, with Discovery Trails a meandering run through the middle. A couple of years ago, a number of trees were been cleared to widen and straighten the run, making it more bland and boring, as well as being less environmentally vibrant.

This appears like a local example of the same kind of slope impacts described in the article.
I've noticed a fair bit of this across Perisher, since before but more of it after Vail arrived. A few trees here, a rock or two there, slowly slowly. Taking out the natural aspects of the terrain that can make otherwise very average terrain fun and interesting.
 

Schnaxxy Schnaxxlburger

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They wouldn't like me then. I've been an EPIC Pass buyer since their inception and I've never used it OS or even considered it when making decisions on where to ski OS. And now that I'm over 70 I won't be buying it to use in Oz. An Over 70s Perisher Season Pass will do me.
And OS lift tickets will be purchased separately wherever required.
Not everyone's point of view of course.
I've used my pass twice at Hakuba, which was good
next trip to Japan I'm not going to Hakuba so I'll be paying for passes, no biggie
 
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robbo mcs

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At Falls, apart from retail and rental, Vail do not have the vertical integration that they are used to with their North American resorts. Harking back to Katz's statement when they first purchased Perisher is that what they were buying was inbound visitation to their NA resorts, I think that they obviously want to ensure that the Australian resorts return standalone profits, which they do, but their measure of success with their Australian venture is visitation by EPIC Australia Pass holders to their North American resorts. Resorts where their vertical integration ensures high yield of dollar spend.
Perisher was actually the most profitable resort in their entire portfolio in terms of EBITDA margin, at the time of purchase. Even better when looking at free cash flow. Projected ROI was just over 5yrs, so it is actually a very valuable cash earner for them, regardless of any benefit of North American visitations.

The figures are becoming more opaque and difficult to identify in recent times, with addition of the other Australian resorts, and more foreign currency earnings from Whistler etc. However, I doubt the profitability of Perisher has gone backwards, (ignoring forex changes since transaction). You can still see the figures for Thredbo for comparison, and that stacks up extremely well against any of Vails NA businesses.

So the argument they bought it only for NA visitation is not entirely correct. I am sure that was in the business case as upside, but ultimately it was a very good deal for them.
 

Dropbear

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Perisher was actually the most profitable resort in their entire portfolio in terms of EBITDA margin, at the time of purchase. Even better when looking at free cash flow. Projected ROI was just over 5yrs, so it is actually a very valuable cash earner for them, regardless of any benefit of North American visitations.

The figures are becoming more opaque and difficult to identify in recent times, with addition of the other Australian resorts, and more foreign currency earnings from Whistler etc. However, I doubt the profitability of Perisher has gone backwards, (ignoring forex changes since transaction). You can still see the figures for Thredbo for comparison, and that stacks up extremely well against any of Vails NA businesses.

So the argument they bought it only for NA visitation is not entirely correct. I am sure that was in the business case as upside, but ultimately it was a very good deal for them.

If that's the case, how could a large number of northern hemisphere resorts with more reliable snow and longer winters be less profitable for Vail than these Australian resorts?

I don't begrudge a company for making a profit, but am wondering how the economics could stack up in such a way.
 

Chookfooter

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The return on investment is good, but the investment wasn't very big, so the actual return is likewise. I think I read somewhere Australian resorts contribute 7% of their revenue, Katz probably spills more than that.
 
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AWJ

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If that's the case, how could a large number of northern hemisphere resorts with more reliable snow and longer winters be less profitable for Vail than these Australian resorts?
Because there's a whole lot more competition in North America. There's close to none in Oz, which means the resorts can charge whatever they want, whenever they want.
 

skinavy

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I remember driving through Andermatt one day in the Autumn, seemed like it was in the middle of nowhere and my Swiss mate said apart from skiing it was a very boring place.
Im sure theres a lot of rusted on red neck farmers who are their main staff in the winter. Any change wont come easily.
Not a bad place, but it is a bit middle of nowhere. Fairly big Swiss Army Barracks there. Stayed in it back in '96 with ADF team. The lifties are interesting to say the least. One sat on his chair and watched us grab the Tees to get on a lift ourselves. Can get a lot of snow, we had fresh tracks every run and by lunch time the chair was dragging through the snow at the top station (must have been the same lifty as the one at the T-Bar)
 
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CarveMan

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Not a bad place, but it is a bit middle of nowhere. Fairly big Swiss Army Barracks there. Stayed in it back in '96 with ADF team. The lifties are interesting to say the least. One sat on his chair and watched us grab the Tees to get on a lift ourselves.
I’ve got a photo somewhere of a French liftie sitting on his chair having a cigarette with a sign in the foreground showing you how to reach back and bump your own chair.
 

MarzNC

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If that's the case, how could a large number of northern hemisphere resorts with more reliable snow and longer winters be less profitable for Vail than these Australian resorts?

I don't begrudge a company for making a profit, but am wondering how the economics could stack up in such a way.
Have you seen the amount of money that VR is spending on new lifts for N. America?

I have no idea what the financial numbers are but the amount of money required for insurance, employee compensation including employee housing, and other business expenses are probably somewhat different between Australia and the USA.

Then there is the realities of different expectations for VR destination resorts in N. America, especially in the Rockies and New England.
 

MarzNC

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To help put the VR employee housing initiatives in perspective, here are notes from 2021 about Big Sky, Aspen Ski Co., and Stratton in Vermont.

January 2021
New affordable housing in Big Sky for local workers

June 2021

November 2021
 

MarzNC

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For anyone who is willing to read all the fine print, here's the latest VR earnings report. The comparisons to 2020-21 aren't that useful since that was the pandemic season with lots of restrictions on travel and capacity limits.

 
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Donza

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Regarding Epic Australia Pass sales, Lynch commented, "We are very pleased with ongoing sales of the Epic Australia Pass, which end on June 15, 2022. Unit sales are up approximately 28% through May 31, 2022, as compared to the comparable period through June 1, 2021, as we continue to benefit from the acquisition of Falls Creek and Hotham in 2019."
 

MarzNC

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I see they have bought 55% of a Swiss resort; Andermatt-Sedrun. I guess if they invested in Australia which was outside their core North American market, it was inevitable that they would eventually move into Europe, the biggest ski market in the world.
The idea is that VR is going to "learn" from the Swiss operation. Will be interesting to see how that goes in terms of what changes, or not, at N. American resorts on Epic.

March 28, 2022

March 28, 2022

May 10, 2022
"
SAM Magazine—Broomfield, Colo., May 10, 2022— Mike Goar, currently vice president and chief operating officer of Park City Mountain Resort, Utah, will lead Andermatt-Sedrun, Switzerland, Vail Resorts’ first European property.

Goar will serve as VP, COO, and managing director of Adermatt-Sedrun, reporting to Pat Campbell, mountain operations senior advisor. His new role will be effective upon deal close—VR acquired the majority stake in Adermatt-Sedrun Sport AG back in March, subject to certain third-party consents.
. . ."
 

Bogong

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The idea is that VR is going to "learn" from the Swiss operation. Will be interesting to see how that goes in terms of what changes, or not, at N. American resorts on Epic.

March 28, 2022

March 28, 2022

May 10, 2022
"
SAM Magazine—Broomfield, Colo., May 10, 2022— Mike Goar, currently vice president and chief operating officer of Park City Mountain Resort, Utah, will lead Andermatt-Sedrun, Switzerland, Vail Resorts’ first European property.

Goar will serve as VP, COO, and managing director of Adermatt-Sedrun, reporting to Pat Campbell, mountain operations senior advisor. His new role will be effective upon deal close—VR acquired the majority stake in Adermatt-Sedrun Sport AG back in March, subject to certain third-party consents.
. . ."
It's good that they see it as an opportunity to learn. There is a long history of American companies investing in Europe and getting things disasterously wrong. One of the more infamous examples is Walmart buying into Germany and throwing vast amounts of cash at the project. But they imposed their American practices and culture, without making any attempt to "go native". So their product lines were wrong, they bullied suppliers and wholesalers who eventually refused to sell to them, they creeped out customers by forcing employees to fake smile at them, they further pissed off employees by making them do corporate chants, the list goes on and on and on. Eventually they pulled out of Germany and wrote off billions of dollars.

So if the Vail manager just observes the way things work in Europe and doesn't try to impose change for the first few years, there is a much better chance of them getting it right.
 

MarzNC

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So if the Vail manager just observes the way things work in Europe and doesn't try to impose change for the first few years, there is a much better chance of them getting it right.
Mike Goar has been an exec in the USA for a long time. He was at Canyons before VR took over. After that he was leading Keystone starting in 2015, then moved to Heavenly in 2017, and most recently moved to Park City in 2019. While at Heavenly, Goar was responsible for VR resorts in Tahoe in general. Hope he stays in Europe for more than a couple years to really understand the ski culture and the differences between N. America and European cultures.
 
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rowdyflat

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I see they have bought 55% of a Swiss resort; Andermatt-Sedrun. I guess if they invested in Australia which was outside their core North American market, it was inevitable that they would eventually move into Europe, the biggest ski market in the world.
Not really impressed.
Being a fiscal conservative I hope they know what they are doing by spending lots of money as we go into a period of higher interest rates?
If Vail ever failed it would be a shitstorm in the ski world.
 
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MarzNC

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The recent announcement of three new lifts doesn't impact overseas travelers much, but will make a noticeable difference in the northeast and Pacific NW. The replacement of the Attitash triple to the summit of Attitash Peak is long overdue.

Attitash is a small resort that was paired with Wildcat by Peak Resorts. It's day trip distance to New Hampshire from Boston. It was possible to ski both on the same day for one ticket. The drive between them takes about 20 minutes. The advantage for an advanced skier was that there was less risk buying a ticket in advance since the Wildcat high-speed lift to the summit can be closed due to high winds or not fun in very low visibility after a rain event. In good conditions on a weekend, Wildcat and Attitash serve very different markets.

June 12, 2022
 

rowdyflat

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Would be much more interested to hear that Vail would actually invest in some new lifts in Australia.
Since i started skiing 40 years ago there has hardly been any new terrain opened , Hotham has done a bit .
Talk is much cheaper.
 

MarzNC

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Would be much more interested to hear that Vail would actually invest in some new lifts in Australia.
Since i started skiing 40 years ago there has hardly been any new terrain opened , Hotham has done a bit .
Talk is much cheaper.
When did VR become fully responsible for operations on the Epic resorts in Australia?

My observation paying attention to VR's acquisitions in the last decade in the USA is that it has usually taken 3-4 years before lifts are replaced or upgraded. The only time a several large projects were done in the first 12 months after a purchase was back in 2012 when three small family-owned resorts in the midwest were bought. Those were separate acquisitions and US$12 million was spent immediately on new lifts and major lodge renovations. Those resorts serve the Chicago, Detroit, and Minn./St. Paul markets. The local news articles right after the acquisition were wary but after the first season under VR were all quite positive. That hasn't been the case since 2015 or so.

As I remember the American man in charge of Australia for VR had a little experience skiing there as a young man. He expected to spend 2020 in Australia. Needless to say, the pandemic changed that plan.
 
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MarzNC

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Since this thread is about VR's financial viability in general, here's the marketing spin about the new lifts planned in N. America for 2022-23. Hosted by Bill Rock. He joined VR to lead Northstar, then was at Park City for the transition incorporating Canyons. Now in VR Corporate headquarters. (Rock was at Snowshoe in WV for quite a while before joining VR and long before Alterra was envisioned, so I've followed his career.)

March 2022
 

rowdyflat

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Would be much more interested to hear that Vail would actually invest in some new lifts in Australia.
Since i started skiing 40 years ago there has hardly been any new terrain opened , Hotham has done a bit .
Talk is much cheaper.
I fully realise its very unlikely given the National Parks are next door but hearing all the cheery news from places I will never ski, I was just hoping.
Its most likely Vail gaining a large foothold in Aus want to direct us overseas to USA or Whistler.
 

MarzNC

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Belinda Trembath is VP/GM for Perisher. She was GM of Hotham before VR bought Hotham in 2019. Was the current GM at Hotham already there in 2019 when Trembath left? Falls Creek has a VP/GM. Has he been around for a while? I don't need answers. Having tried to follow the career path of senior managers in VR in the USA, I know there is a lot of shuffling every year. For destination resorts in the Rockies, there are press releases. Not that common for the GMs of the small resorts in the flatlands.

Took a while to find . . . the most recent COO for Vail Australia was Pete Brulisauer. That means the American who had the job in 2020 never really got started. Brulisauer left VR in January 2022.

January 25, 2022
 
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