Q1 2021 Vail Resorts Inc Earnings Call
Good day and welcome to the Vail resorts first quarter 2021 earnings call today.
Today's conference is being recorded.
The reminder to enter the question queue, you May press star one at anytime during today's call.
At this time I would like to turn the conference over to Rob Katz CEO. Please go ahead Sir.
Thank you good afternoon, everyone.
Welcome to our fiscal 2021 first quarter earnings Conference call. Joining me on the call. This afternoon of Michael Barkin, Our Chief Financial Officer before.
Before we begin net remind you that some information provided during this call may include forward looking statements. The based on certain assumptions that are subject to a number of risks and uncertainties I've described the nurses and filings the actual future results may vary materially forward looking statements I'll touch on the she should this afternoon, along with our remarks on the call are made as of today. The some of the 10 2020, we undertake no duty to update the.
Children simple things. The March include certain non-GAAP financial measures reconciliations of these measures are provided in the tables included with our press release, which along with our quarterly report on form 10-Q, the targets after the with the FTC and also available from the Investor Relations section of our website at Www dot the always on Dot com.
With that said that's true to our fiscal 2021 first quarter results. Our results for the first quarter continued to be negatively impacted by corporate banking and Australia hop in the false Creek remain closed for the entire quarter.
Moving the issuance of stay at home orders by the Victorian Government on July 820, 20 range.
It's again, a significant decline in revenue compared to the prior periods per.
Her show the the teaching trends improved relative to July 2020, that's available to screen increase the results continued to be negatively impacted by COVID-19 and related capacity comes from.
North America, our U.S. resorts experienced improved demand from leisure travelers throughout the quarter relative to the fourth quarter fiscal 2020.
Of visitation remains well below historic levels of Whistler Blackcomb demand remains significantly below prior year levels due in part to travel restrictions with the Canadian book or the remaining close the entire quarter to international GAAP, including cash from the U.S. we.
We continue to maintain disciplined and rigorous cost controls throughout the quarter to partially mitigate the reduced revenue levels resorts net revenue for the first quarter declined to $132.1 million compared to the prior year, Robert George reported EBITDA declined only $18.1 million over the same time period.
The cost reductions driven by a combination of reduced seasonal labor and expenses as well of significant overhead cost saving the options first.
First quarter was the work net revenue includes the recognition of approximately 15.4 million of lift revenue rose maybe to the September 17, 2020 exploration of Unredeemed credits offered to 2019 2020, North American policyholders for which we defer to total of $120.9 million of revenue from our prior year.
<unk> sales, which would have otherwise been recognized during fiscal 2020.
We expect to recognize the remainder of the deferred revenue associated with the credit offer of lift revenue primarily during the second and third quarters of fiscal 2021.
Turning now to our 2020 2021, North American season pass sales.
As we approached the end of our selling period season pass sales for the North American ski season increased approximately 20% in units and were flat in sales dollars through December 620, 20 compared to the prior year period end of December eight 2019, which sales dollars for this year reduced by the value of the redeemed credits.
Provided to 2019 2020, North American pass holders with.
Without the docking for the value of the redeemed credits sales dollars increased approximately 19% compared to the prior year.
The sales results are adjusted to eliminate the impact of foreign currency by applying an exchange rate of 78 cents between the Canadian dollar and U.S. dollar in both periods for Whistler Blackcomb past sales.
Oh sales of reduced by the amount of the epic coverage of refund request process through December 620, 20, but do not include any estimated reductions for future epic coverage refund.
We're very pleased with the growth in our season pass program, particularly given the challenging circumstances surrounding the impacts of COVID-19, we expect total number of gas on all the advance purchase path of this year will exceed 1.4 million, including all topic for our North American and Australian resorts demonstrate in the significant boy.
LTV of our guests based on the strong demand for our mountain resorts.
The September pass sales exceeded our expectations, primarily driven by continued strong demand from destination GAAP and significant growth in pass sales to guess who were not previously in our database, particularly in the lower frequency epic day pass products.
For the full price sales season, we saw very strong unit growth broadly across our destination markets. We also saw solid unit growth you know from Utah, Northern California, and with the markets and in Colorado, So comparable performance to last year.
The primary driver of our unit growth was from the <unk> pass holders given the credit incentives offered for renewing GAAP, but we also saw strong growth in new pass holders with particularly strong growth in the past sales to GAAP, we're not previously in our guest database.
We saw strong growth in our epic pass and epic local power products and very strong growth in our epic day pass products demonstrating both the guest loyalty we have created in our core programs and the success of our long term strategy to move new and less frequent guests into our pass products.
We expect that some of our epic day past growth maybe the result of the circumstances surrounding the season. We also believe that the growth from new guests into our accounts products. This year will accelerate our ability to move gas into advanced commitment into the future the.
The success of our total program. This year has been supported by the value proposition about past the all that and the steps taken to address the current environment, including our pass all the credits extended that deadline.
The reservation system, New Epic Hubbard program included with the purchase of every pass products for no additional charge continued data driven marketing efforts Inc.
During the peak resorts in our network and the second year offering on the water epic day cost total.
The step the safety of our gas employees and communities continues to be our top priority. As previously mentioned, we implemented operating procedures that we believe will enable us to operate safely across our 34, North American ski resorts throughout the season, including the implementation of a reservation system for our GAAP.
Currently the reservation system, which opened to pass holders on November six 2020, and lift ticket purchasers on December eight 2020 continues to have available capacity for almost all day during the course season across our resorts.
Reservation system, and our contingency planning around our operation has positioned us to react quickly to the changing circumstances surrounding COVID-19 restriction from our resorts jurisdictions, which we expect will continue throughout the season.
Now I'd like to turn the call over the Michael to further discuss our financial results liquidity, the and fiscal 2021 outlook.
Thanks, Rob and good afternoon, everyone as Rob mentioned our results for the first quarter were significantly impacted by Tobin 19, and the resulting impacts to our Australian and North American Mountain resorts net.
Net loss attributable to build resorts was $153.8 million or a loss of $3.82 per diluted share.
For the first quarter of fiscal 2021 compared to a net loss attributable to the Vail resorts of $106.5 million or a loss of $2.64 per diluted share in the prior year range.
Resort reported EBITDA was a loss of $94.8 million in the first fiscal quarter, which compares to resort reported EBITDA loss of $76.7 million in the same period in the primaries in the prior year, primarily as the result of the negative impacts of COVID-19.
Our liquidity position remains strong to mitigate further disruptions from the impact of the COVID-19 pandemic.
The total cash and revolver availability as of November 30 of 2020 of approximately $1.2 billion, the $614 million of cash on hand, $419 million U.S. revolver availability under the bail holdings credit agreement and $169 million of of revolver availability.
The under the Whistler credit agreement.
As of October 31st 2020, our net debt was 4.1 times trailing 12 months total reported EBITDA.
We continue to expect to have sufficient liquidity to fund operations through at least the 2021 2022 ski season, even in the event of extended resorts shutdowns.
Now turning to our outlook for fiscal 2021 day.
Even the uncertainty COVID-19 has created from travel demand operating restrictions and the ultimate visitation to and spending at our resorts. The company will not be providing full year guidance from the for fiscal 2021 at this time.
That said, we're very pleased with the results of our season pass sales and the strong foundation of visitation and revenue that creates heading into the season.
Given the challenging dynamics associated with the Tobin 19, we continue to expect material declines in visitation to our resorts and associated revenue declines in fiscal 2021 relative to our original expectations for fiscal 2020 Prime.
Primarily as a result of expected declines in visitation from non pass lift ticket purchases due to reduced destination visitation with more material decline specifically among international guests.
While we expect that mandate of capacity limitations will have a negative impact on our visitation during peak periods. We expect the primary driver of visitation declines from the North American ski season to be a result of reduced travel demand.
We expect additional negative impacts the visitation in select regions, where heightened restrictions exist, including Whistler Blackcomb given Canadian border closures in domestic travel guidance.
And Vermont as the results of the quarantine policy for out of state travelers.
We also expect significant negative financial impacts on our ancillary lines of business materially in excess of the decline in visitation as the result of significant cobot, 19 limitations and restrictions, particularly in food and beverage and and ski school.
Food and beverage we have recently reduced capacity at our restaurants and of limited many of our on mountain restaurants to grab and go options in ski school, we've reduced group sizes and it many resorts eliminated full day and the other select lesson types in response to COVID-19 limitations and restrictions.
Since the start of Tobin 19 disciplined cost management has been a primary focus but significant actions taken to date, the tightly manage our costs with reduced revenue expectations. We've.
We've implemented operating plans of actively managed our expenses, while maintaining a high quality experience for our guests and we remain confident in our ability to deliver against the cost structure of variability previously outlined in our September 2020 earnings release.
I'll now turn the call back over to Rob.
Thanks, Michael.
We remain committed to reinvesting in our resorts, creating an experience of of lifetime for our GAAP and generating strong returns for our shareholders. We plan to maintain a disciplined approach to capital investments keeping our core capital at reduced levels given the continued uncertainty due to cope with the king.
We will announce our complete capital plan for calendar year 2021 in March 2021, but we are pleased to highlight several signature investment plan for the 2021 2022, North American ski season, which were previously differed from calendar year 2020, as the result of COVID-19 and are subject to regulatory approach.
In Colorado, we plan to move forward with the 250 acre of lift service lift served the terrain expansion in the Mcquaid Park area Beaver Creek, the new lift the access beginner and intermediate Bowl experience is a rare opportunity to expand with highly accessible to rein in one of the most idyllic settings in Colorado and will further down.
Brinci at the high end family focused experience of Beaver Creek at the.
Breckenridge, we plan to install a new four person high speed left to sort of the popular peak seven this additional lift will further enhance the guest experience at the most visited resorts in the U.S. and will significantly increase cash access in circulation for the intermediate terrain on peak seven and sex Act.
The Keystone, we plan to replace the four person per room left with the six person I speed chairlift in order to increase capacity out of a key base area of the resort and improved guest access circulation and the experience and one of the top performing resorts in the U.S. The crested Butte, we plan to replace the two person fix grip Peach tree chair lift with the new three per.
The fixed grip blip that services beginner terrain at the base of the resort and will improve the uplift capacity. Additionally, we plan to improve the grading of the terrain serviced by the Peachtree left to create a more consistent experience for our begin right.
The school GAAP, it'll chemo, we plan to complete the transformational investment, including upgrading the quantum leap from a poor person to a six person high speed chairlift relocate existing four person quantum left to replace the Greenridge three person fix script share like these investments will greatly improve uplift capacity further enhance the guest experience.
And complete our $35 million capital plan for Triple Pete.
We will also continue to investing companywide technology enhancements to support our data driven approach and corporate infrastructure, which will improve our scalability and efficiency as we work to optimize our processing business out of letter and cost discipline across the network.
In particular, we intend to invest the number of upgrades to the infrastructure of our guest contact centers and bringing the best in class approach to how we service our guests through these channels of call centers and chat functionality, we're not well suited to handle the more than four fold increase in calling shot volume we saw over the past six months, which created a challenging.
Hearings for our GAAP, we will also continue to invest in ongoing maintenance capital to support our infrastructure across our resorts we.
We plan to spend of approximately $4 million on integration activities, primarily related to peak resorts in total we expect our capital plan for calendar 2021 will be approximately 110 million to $115 million, excluding onetime items associated with integration and $11 million of reimbursable investments, including the.
Onetime items, we expect our total capital plan will be approximately $125 million to $130 million we.
We will continue evaluating our calendar year 2021 capital plan of the season progressive including potential opportunities to increase the planned level of investment and we'll be providing further detailing the update in March 2021.
We remain confident in the long term prospects of our business model that is built on the loyalty of our GAAP. The strong line up of season pass products that provide access to our irreplaceable network of world class of resorts and the sophisticated data driven marketing approach, we use to communicate with and attract okay. Our.
Our strong capitalization positions us to continue to invest in our people our resorts and the guest experience while remaining flexible to manage through the evolving circumstances caused by cold the 19th.
I would like to thank all of our employees for their passion hard work and commitment to creating a safe exceptional experience for our GAAP.
As always the lies at the center of our success. It has never been more tested and over the challenges of the past nine months and then what lies ahead for the upcoming season.
I'd take tremendous pride in our team full engagement and balancing the new needs and requirements of all our Barry the stakeholder in an ever changing internal and external environment.
Well nothing we do is ever perfect and it can always be improved its very clear how all of your cash.
The system they remain guided by the same core values that have been at the center of our company since its founding.
At this time, Michael and I would be happy to answer your question.
Operator, we are now ready for questions.
Thank you if you would like to ask a question. Please signal by pressing star one on your telephone keypad. If you were using the speaker phone. Please make sure. Your mute function is turned off two of them out your signal to reach our equipment.
Again, Please press star one to ask the question, we ask that you limit yourself to one the initial question and one follow up.
Well take our first question from Felicia Hendrix with Barclays.
Hi, Good afternoon makes is the wiessner all the color and the first question I had is on your upside surprise on the season pass sales and as you outlined the major difference between your original expectation anyway the destination.
Particularly in the past.
I'm just wondering is there anyway, the kind of parse the will review that like when you were when you gave that guidance the wave season pass sales.
And GAAP in last quarter, and you know what were you expecting to half day in and and what was different at the end.
The if you just give us more interest in equal the smoke.
But if you can kind of parse net.
And then also I see that you just extended the kind of beat for the passing of grass.
Why.
So I guess from the first piece what I would say is we I guess there were two components one component was.
The renewal.
Pass holders and we felt like we were going to we had pulled forward a lot of renewal.
That would run occupancy as many renewal.
From September through December as we did last year and that turned out to the true I.
I think the second piece is designed to assess the you know the conversion of people who were in our database either in a lot of pass from pre paid pick last year last day ticket and trying to assess.
You know their propensity to buy a.
Path this year and I'd say, the where I got largely in line with the I think the heart of thing for US. The forecast was you know people who are not in our GAAP database at all so we don't really have history on them to the south we.
We do obviously call new people in every year.
Obviously, there was the case to be made that because the.
Lift ticket, they're being more restricted this year, the maybe even with the some of those folks and on the other hand because of the COVID-19 of.
These would typically be a.
The lower probability conversion opportunities of the company. So I think we were you know just conservative about that given the environment, we were going into the ultimately it was really back the route that drove a lot of the upside you know from our expectations in the September that we saw particularly in the epic one to three day product and of obviously that part of the.
The second year, you know we had a we had high hopes for that product one of the box it to do exactly what it did the year, but but again hard to always tell something about new and even harder when you're in the middle of the pandemic, but obviously, we're quite pleased to see that I'm on the past deadline of weak the past debt.
And why was scheduled to be December six then of and it was Katz at December six I think the only thing that we did was the extended up from about how do we the opportunity for people to pick their epic coverage of priority Reservation day. So that you just gave people a little more time to make.
Make the selection in terms of how the coverage would work for their situation.
Okay, Thanks, and interest can you.
Can you remind you we flow what percentage of that is your visitation and or EBITDA and then overall what percentage of your.
Yes, the teaching is nishan versus local.
Yeah, we don't break out you know.
Hi resort at this point because of the.
Sales of the the nature of the epic pass the unallocated across.
The entire network. If you look at you know where Whistler was when we did the deal roughly about half of their.
Ah half of their business came from the U.S. for international So it's about half domestic Canada and about half of hi, odd non Canadian.
And that's that's about as much as we can provide the discipline.
The and then just on the overall company what percentage of your give you the patients.
Since the local.
Yeah, we actually haven't updated that with peak so I I don't have a Ah I knew of number for you on that we were.
For our destination resorts, we skewed a bit over half on destination <unk> versus local and all of our last numbers that we put out.
Okay. Okay.
Okay. Thank you.
Yeah. Thank you.
Thank you we'll take our next question from Shaun Kelley with Bank of America.
Hi, Thanks, everyone. Good afternoon, Rob.
Rob just to kind of stick with the the first part of the last question wondering if you could just give us a little bit of color. When you talk about the this new customer cohort the that sort of came into the cash.
I don't know that much about that but you know I think you've broken the down a little bit by the type of product. It's the their most attracted by the from one to three day product, but are the regional or destination in nature, just for that that new cohort or kind of.
What are you thinking about you know how valuable that you know that debt that groups that could be kind of going forward even after the season.
Yeah, I would say of very much the destination guests. The we do know that and and I think coming you know from a broad array of markets.
You know the across the country and you know I think this is the Gan something I think the good news for US was obviously, we had already put you know design the product introduced that put it forward. The last year. So we had a marketing approaches even though we didn't have the contact information obviously of the channels that we try and reach people.
So we have that are out there and I think you know it turned out to be exactly the right product for this market right now and that I think a lot of the spokes replying clearly the take a trip you know they I don't know whether they were all the planning to come for a couple of days or maybe they were the you know our planning of potential longer trip the figure they would lock in a couple of these.
David upfront and the attractive value for them and obviously the be able to get into the reservation system early.
You know they may ask David as the season goes on I think what we'll learn all of that are the fees and progressing.
But again I would say you know this with you know when we talked about the epic they passed from launch debt.
This was really exactly what we were looking for and I think no doubt that that the pandemic for those people who are committed to coming clearly this is a product that was an opportunity and I think you know more broadly. It certainly appeared as though you know for people who are looking to take some kind of trip over the winter.
And have the potential interest I, you know winter vacation I I just on the you know being outside of being outdoors, you know into an expense and the thing they'd be aware of clearly resonated.
[noise] on second question would just be like you know that this was a little bit more theoretical but if we fast forward to next year and travel.
Travel has returned or is it kind of by and large normal by the by next ski season, what are your thoughts around how you think the retention rate could play out because this year, obviously between the discount of what you saw in the you know the or the on the on the credit I should say on what you gave on the coming out of last season combined way.
You know I think the reservation pattern and the in a variety of other things.
The worked really well on you know your ability to retain existing people do you think this could stay at an elevated level of you learn some things about this Rob would you expect it to to mean revert closer to historical levels and sort of why the kind of what are you thinking what you're thinking.
Yeah, I think it's still probably a little bit early for us. The habit, you know kind of final views on this because you know we're still digesting and analyzing obviously the results that ended you know I'm just Ah you know a little of a week ago.
But but what I would say is that I think.
No doubt that there were the credits clearly helped and I think in particular or help with people, who you know were low frequency fears of during the covered the or.
And and certainly helped I think we accelerated and certainly help retain I think some of our in high frequency of gears for a second product because of the.
The minimum 20% credit.
And obviously, it's certainly helped that people understood that there were the benefits of getting in early <unk> you know on the other half of its really important to not overlook. The we are in the middle of the very of certain travel environment and so on balance I think you know there'd be a huge benefit I think to us and in having.
Our normal environment that Weve, who you would be selling into.
You know where the focus on all of you know restriction understanding the experience understanding you know things like that the coverage, which typically are nowhere near as important as it was the fear I think all of that would allow us to honestly flex a little bit more in other areas. So how that balances out next year, you know I think that the.
Only the little bit hard to say right now.
But but I mean to me. The most important thing is that you know in the middle of the of COVID-19, when I think a lot with the risk of.
We're able to retain right the the core customer and actually introduce new people into the program and you know as you know having their data having them as they pass holder in the one obviously dramatically improves our ability to the market to them and to retain them for the future of so you know I think an <unk> and by the.
The way the prospects that brought in.
You know the people who are not Mark guest database before there was no credit for that obviously there was no discount offered from when they were getting from the thing product is everybody else. So I think on balance I know, we walk away from the feeling very good exactly of them out the work out I think what you know what weve seen them and you know we'll have the probably more to say about the.
Going to next year, but but I think we leave the selling some of them you know quite positive about where the program is going.
[noise]. Thanks.
The last thing I would have just the could you talk a little bit about the recent headlines out regarding lake Tahoe. This morning possible either kind of stay at home orders the in California and how.
That could impact you know sort of the broader and broader operating activities, but I imagine, it's something we're going to have to struggle with possibly around the portfolio given.
So dense urban town you talked about from on a little debt, which had some I think some very confusing policies. He can you just talk a little bit about kind of.
What you know right now on some of the like regional or local operational challenges and kind of how you're exactly contending with this are dealing with it at the resorts level. You know just for the season kind of as it comes from based on what you know right now.
Sure and I, you know I would say number one yes, I do think that we will be having to navigate the ever changing restrictions and new regulations throughout the portfolio.
At every resorts whatever can you do the in every locale throughout the season and I do think you know that the right now certainly a lot of those changes are ones that are making a further restrictions right on the kind of activities of the people can do and what we can do with the resort, but I think we also said assuming that there's.
Probably going to be some positive trends to at some point you know during the season. So we may see some loosening the well and I know all of our communities on our company. There are focused on partnering right to obviously bring down of.
The case load or you know everywhere. So in the end you know I think we will you know what's the kind of both sides of the and I think from an operational standpoint, no. It's it's one of the reason why some of what I said at the end of my remarks about our employees I think this does put tremendous strain and challenge you know the company.
The whole and everybody right to try and addresses I think we had the one advantage from that I think we have it you know we went in with a lot of preparation of a lot of from a you know the reservation system. We have a number of central team that are currently.
The only monitoring everything that's going on that are that are heavily engaged with all of these local regulators of local public health all about and so he can use that information and we can obviously also you know take.
Take a a kind of best practice approach because we understand the we've already seen what's going on top of the something like batches of somewhere else and we know how to drop and the can immediately put that in place and that's the that's the real advantage I think by having the number of resorts and having the central approach that we have because the central from the standpoint that we can kind of push it out but actually.
Each of these resorts as they go through whatever new restriction I get the enacted they become really the leader of that for the rest of the company. So you know I feel like we're well prepared but there's no doubt that this is going to be operationally a very challenging season ahead.
Thank you.
Yeah. Thank you.
Thank you well take our next question from Chris Woronka with Deutsche Bank.
Hey, good afternoon guys.
I wanted to ask about how the mechanics are going to work on the reservation system of event someone can't get a reservation on the day.
David the one is that does that trigger a refund process or.
How does that work.
So the the way the system works and again I'll jump on that of of course copy out of anything on the as to the terms and condition. The of course on the program that are out there on the website, but but you know in and short hand, the what I'd say is yeah. The we had a time period through December seven where people all of our house.
Others have the opportunity to go out and get reservations and to the extent that they were not able to get the day that they wanted they have the opportunity to then get a real.
The recon.
You know.
Through December of stuff.
And so to the extent that they did on the not something that we were going to now review.
And you know, we'll look at obviously what comes in and the to make sure that the lines with all the terms in the dozens of them in the will of course follow through with the guest on a going forward from here forward.
They can't make a new reservation that they want that got in of itself does not create a refund of that.
Okay.
Very helpful and then I really still very early in the in the season, but as you kind of comb through your your day databases of where where folks are showing up we're making reservations.
Is there any hard data yet the validate the thesis that people are staying closer to home and folks from New York are going to Vermont more so than there maybe go into Vail again, I know, it's early and you haven't really hit the peak holiday. The up is there anything anything out there to kind of figure.
Figure out the magnitude of.
How close to home people are saying.
Yeah, I think it's a little it's definitely too early to make any assessments of the I do think you know from from some of the reservation data that we're looking at I don't you know I think that that that our destination guests are absolutely looking to potentially travel to the west and and there's no doubt that you know the the biggest net.
Numbers of reservations of course are in our day gets western resorts, and especially where with the non adoption really for how many people within the U.S. I think that that of course, we'll put more you know interest I think in our Colorado and Utah resorts. So so at the moment of I think we'll see how the.
Plays out, but right now given the strong.
No momentum that we saw again, Rob the across the destination markets.
Right you know many of our destination markets most of our destination markets. You know don't have an option for them to the skin close to home. So obviously these are folks who are willing.
To either get off line drive you know longer distance out to our resorts.
Okay very helpful. Thanks, guys.
Thank you.
Thank you we'll take our next question from Laurent Vasilescu with Exane BNP Paribas.
Oh good afternoon. Thanks for taking my question on the.
On the last call. An illustrative example was given that of resorts revenues declined 30% for fiscal year 2021, you can expect resort EBITDA to be about two of $400 million I was just curious and any updated thoughts on on the framework as we progress through the fiscal year.
No at this time no updates to it you know as I mentioned in our earlier remarks, and then in the release I think we've got you know stay.
Stayed very very focused on our on our cost discipline and I think manage to that you know I think you can see the results of that in our Q1 results and you know certainly remain committed to managing through that as as we you know go into the season here and no changes to the illustrative.
Sample that we provided in September.
That's great to hear and then shifting focus your the cope with the just curious kind of create an opportunity to take share or even potentially acquire some standalone mountains that might not be in good shape, but might have the same balance sheet that you have any thoughts on that front.
You know I think it's hard to say I think that will play out over from over the upcoming 12 to 18 months I think you know we have seen in previous.
You know events that are sometimes the stabilizing that you know add after things stabilize the people or something that's interested in having a strategic discussions again again I think you know usually in the middle of the instability, sometimes tougher to have those discussions, but I think.
As a you know as you come out of the other side I think that's the that's where there's an opportunity and you know I think the US. We certainly you know when we look back historically, we were able to do a lot of things both internally and externally on the strategic side coming out of the per Wedo non recession and I think you know we're very focused on positioning.
The company.
The other to make the most of whatever opportunities are out there and certainly you know our our capital of liquidity and you know an access nice path relative yeah. The this is it has been a strength maybe of the more differentiated strength right now.
And sales leveraging that to make sure that we can you know we don't Miss anything over the next the 12 month I think is critical.
Very helpful. And then lastly, I know this is the little over your outside Beijing will be hosting the winter games.
And I believe quest, whereas the sizeable.
Market for it for the Chinese consumer how are you positioned yourself to leverage the games to track more visitations from Asia, whether that's with your mountains and North America, where maybe the Australian and maybe some of the partnerships you have the Japan.
Yeah, I think you know is one of the per.
The primary you know reasons why among many that the whistler with such an attractive acquisition opportunity because the news that you know long term.
They had such a good connection or the.
The best connection I think in North America with the Asian market that we felt like that was an opportunity for us to you really lead the way and I think GAAP. The resort level. There are many things of that the resort had done on many fronts, whether its around language or the food or relationship that's the travel providers and the wholesalers you know.
In China to.
To continue to drive that that business I you know of course, you know, we're a little bit of hiatus MPOG during cobot and some of the travel the search and but but I think once coveted behind us that's something we're absolutely get it.
You know <unk> re energize a you know all of the effort and yes, I think you know an opportunity both through the partnerships and ultimately potentially through acquisition.
In Japan.
Yeah. It was critical I think the same yes, there is a real opportunity on the they'd seen that are ready and the Australia.
So again I think you know the China, Inc. The market is one of the you know maybe the best right Bigots global opportunity and the entire steel industry and you know where all of the moves that we make.
You know for of the company strategically are oriented around making sure that we.
Can get a benefit from the tribe.
Very helpful. Thank you very much.
Thanks.
Thank you well take our next question from Patrick Chills the truest.
Hi, good afternoon, everyone.
Question for you I see got shot Eagle County is in the <unk>.
Orange designation for Kogut in Colorado in Summit County, or in the <unk> is in the Red designation has the Governor told you what would happen if those moved to the highest level purple how would that impact the ability to run your lips. Thank you.
Yeah, I mean, no we obviously rent communication at both the local county and state level I'm on the ongoing basis very high frequency the dialogue, but you know other than what is the out there.
In the regulations that are posted Ah you know, we don't have additional information and you know its it isn't just it's obviously decisions that are that would be made at both the state level and at the county level. The bulk of those would ultimately be a critical of players in terms of whatever decisions are made of clean net.
Beyond that what I can say I think you know obviously the boat Summit County, Colorado, and Eagle County are working varying kind of play to bring down the caseload and to get to a decreasing slope, Oh and I know that the eagle kind of very focused and we are keeping them and in the orange for right now.
You know, whether that's possible with the and I know, it's on the kind of looking obviously to.
Hopefully move from aren't from Red Orange. So again, you know a lot of work going on every level, but exactly what the outcome of the <unk> or what the regulations would be if they move the purple line at this point, yeah, not not 100% clear.
Okay. Thank you for the color on the that's it yeah.
Thank you well take our next question from David Katz of Jefferies.
Hi, good afternoon, everyone. Congrats on a on the results.
Thank you know I I've had a number of discussions of late you know around certain areas, where you know, there's an unusually high right and the not at all surprising.
A number of people either buying or renting homes.
The areas like near your largest mountains.
And presumably over the long term you know that population growth fried if it remains permanent it's helpful, but I'd love to hear.
You know just a.
A bit more thought about what happens in the near term and then you know long.
Longer term, what you may be seeing along those same lines about people moving there and any you know evident.
No impact on.
What you what your published the results so far.
Yeah, I think I get the certainly we would agree I think we're seeing very strong demand right for resort properties, then and a lot of transaction you know the many ways the probably the strongest the around the same thing.
2008 from 2007.
And you know I think yeah people are looking for opportunities the being kind of the outside of many of the big city because of co. The you know how that shifts.
You know I've hopefully the you put covered behind us because in the non <unk>.
I'm not sure, but I, but I wouldn't say the us I think the of the work from home trend right using Oh, you know video technology and other technologies. So that people can work remotely you know it would seem like that trend is clearly going to it's going to continue in sub level.
I think that's probably going to be true on some level per schooling, particularly in the higher education and so you know to the extent that people are able to put themselves in vacation spot.
You know a more balanced way throughout the year and not just cluster of into the peak times I mean that would be a huge benefit.
Two I think the resort industry and obviously the our company.
You know, we still obviously do struggle to move people out of peak times the into off peak times and to the extent that you know, they're not as tied down to the job or potential school ER.
And can do things remotely them, then obviously that would you know whether it's the buy real estate or it's just that people will travel and the more.
Even way throughout the season, I think that that could represent a major opportunity.
Coming out of the co the dynamic to out to the entire vacation the industry, but but particularly for our company.
Thank you and with respect to the the the very near term and apologies for the short term question, you know, which May bear. Some unknowns you know should we find ourselves 30, 60 days you know down the road and you know there are circumstances, where you know the most.
Hunton is open.
But for whatever reason you know a person can fulfill right. They may have missed the reservation opportunity, but they were made one and they can't fulfill right I can't get to the mountain I you know I assume that there are some latitude within you know the program as it as it's laid out and one of them essentially getting at is the prospect of.
You know, whether we would have any credits rolling into next season as well potentially.
Yeah, I think at this point I you know our view is that you know we tried a very tough and make up of coverage of comprehensive and to address.
You know many of the most likely scenario throughout the season and yeah. We're hopeful of that or the you know that that will be provided support for for our gas I have no doubt like in any year of won't be a perfect solution and it won't necessarily solve everybody's problem, but right now obviously, we feel like.
You know, it's because of the strong program that I think you know won't be available of people when they needed. It and I also think that at the end of that we're going to have obviously, a it's a long season. We're just at the very beginning and I think you know a lot of our pass products all of our pathology are basically about flow throughout the season, and so that really give people multiple opportunities to come.
Sure I'll take the Trups I think that also helps in that we're not just talking about you know one situation.
So at this point I I think you know the we feel good about where we are of that problem.
Got it. Thank you very much congrats thank you.
Thank you we'll take our next question from Paul Golding with Macquarie capital.
Great. Thanks, so much for taking my question. So I was wondering if there was anything from the database the you could share around how many.
Or or what.
Portion of the single day.
With tickets the lift ticket customers traded up the into epic just trying to understand to what extent, maybe if you have any color on the of the dynamic Robert you were talking about earlier of the.
Maybe fear of not being able to get the priority without the past contributed to tailwind for you and and and hearing people up into the past network.
Yeah, I think at this point again, a little too early in our process to to have all the insight you know perfectly dialed in and so I I don't think I wouldn't comment on exactly the specific on it but I guess I would say.
You know I'm, just seeing the dynamic with prop with people who are not in the database right at all and seeing the strength, we have there I I am sure that the urgency in terms of you know getting the priority ticket you know what was important to the and that's that I'd also say the you know a lot.
Of the folks came in towards the end not every one of them has made the reservation from.
And so I also have no doubt that part of this was the value proposition you know a big part and so you know it's important to remember the last year, obviously, when we didnt have the epic day passes the very strong performer for us because of the value of got it offered and so I think we're seeing that again now no doubt helped helped somewhat.
And I've no doubt that that these are folks who in the absence of buying the path you know would've been obviously, our most likely lift ticket customer.
But but yeah I don't have a you know anything any additional information at this point the share on kind of the exact conversion.
For for each guest type because they're they're actually of are quite of a lot of them at the quite a lot of dynamics of the.
The by product type bye for this year, probably talked the last year or four geography, and all the different points. So that's one of the things will obviously the spend quite a bit of time on before we go into next year.
Got it and then just a follow on to the that are around the database.
As you were going into the the end of the selling season is there any of so you can give on.
Volumes or integration progress of any peak database, a uniques that you were able to carry over and successfully and that you've been able to retarget or anything around.
Essentially what the the like for like there is as far as you being able to integrate more a unique synta into your own process.
You know I can't really share of specifics on that from what I would say I think we feel very good about this first you're right you know with having a peak of.
Pulling in the program.
And you don't feel good about our results in the north the I think especially given some of the restrictions that are in Vermont.
And you know we feel like we have different of how does the good first year with peak of good proceed with the day to day I think you know what we've seen with other acquisitions is that often we see an acceleration in the second and third year because of the data that we're getting a lot of the history of that is tougher for us the fully integrate said when we generated ourselves.
Of the enough kind of claims that ourselves and all of that so I think that's an opportunity for us as we go forward, but I think yeah I feel good about that first year with the.
Great. Thanks, so much.
Thanks.
Thank you we'll take our next question from Alex from Russia with Baron Burke.
Good afternoon. The particular my question just one of the.
The last.
Still waiting.
Uh huh.
Alex where we're actually having a bit of a hard time here in the you're breaking up a little bit.
Is it any better now.
Yes. Thank you.
Yeah the problem.
Last quarter, you were still waiting on 75000 or so on line forms. The process you can get a sense of how many people were going to downgrade their passes and deal with some other random issues can you just give us a sense of how many ended up downgrading and just in general what you're seeing across the portfolio.
Yeah, I would I would say that I think on on the forms piece, we were able to convert you know quite a few of those folks a into a path product.
But but not up but not everyone. I think there were a number of people who you know where were you.
Yeah, what were of whatever they were interested in one of the you know where the form of whether they were requesting wasn't something that we could ultimately the Phil I wouldn't when the out that something will you know maybe decided not to the or not to proceed.
But but actually you know I think in total the forms where where a nice contributor to our numbers, but it wasn't the the total you know the we announced in September which isn't a huge surprise.
Two of.
I think on the downgrade no I I don't think downgrading was a material driver or this year I think debt.
The you know.
The second pass from where the difference between units and revenue was much more impacted by the fact that we have a lot of new people coming into the very low frequency product and that Rob brought down the either kind of the average yield, but but it wasn't necessarily that we saw of seems downgrade of issue.
Okay understood. Thank you.
Thank you.
Thank you we'll take our next question from Ryan Sundby with William Blair.
Hey, Thanks for taking my question Oh, Okay.
Okay, I guess just to talk them from Paul's question, a couple of back there when.
When you look of the 20% increase in patching that's for the year as you look at that shape of growth here for the year to that pace change at all during the final couple of weeks as we started to see coded keep the dry rights from the country.
No I mean, so we did not see a any kind of impact.
The broadly on the program I think that we we definitely saw better strength.
And you know outside the north the than inside of the northeast I think at the end of.
But you know whether that.
Yeah, the das up of the I mean, obviously, we still saw very good growth in the northeast. So the idea whether that that was just timing or whether that was because of the restrictions I don't know, but but we did not see.
Any material decline or change in trajectory of we went into the final thought line that we you know at all and certainly nothing that we would attribute of what we're seeing on top of it.
Now that said I think you know the.
In terms of old pit visitation to the resorts.
From either pass holders or you know Pete ticket holders. So our belief that we will see a material and got the.
You know you know while the you know these cover the restrictions are in place, but again I guess that's to be seen.
So the the Super helpful and then Rob just.
Were there any key learnings or anything that's the price you in Australia that but you can carry over here and there to the U.S. at the start the season true true this year.
You know I think a few key learnings were one be prepared you know as best as we can you know obviously.
This is such a unique environment that it's really tough to be prepared it every day on every day and to <unk>.
Try and forecast everything that could happen, but I think you felt like you know one learning was the out of the better we could get on system the better we get too.
Operator, or whatever environment was thrown it off the line nickel and we also saw it in Australia. The you know that there were still demand even in the middle of the pandemic. There there were still the mantra comes to the resort there were still demand for passive I think that gave us confidence on the.
You know if we gave people of the right time, if we you know the gun leaned out our credit approach of the coverage something that we introduced in Australia. The two that you know that ultimately those things would really help or health of the business and then I think in fact, we took a lot of you know insights from.
All kinds of things from Australia resorts that I think really helped us.
You know plan. So there are a lot of data points that we took from from especially from Perisher.
You know that we use whether it was on pass sales when it was on the you know the people you know who is going to show up who wasn't whether it was on how to do your foodservice whether it was how to do some school. So I think all of that gave US an advantage and at the same token.
You know we opened Keystone as our first resort I think you know all 34 of our resorts in America, where immediately getting learning from the peak Donlin Breckenridge open immediately getting learnings from record.
So I think you know I'm not the ops team is doing a terrific job the of really using that as our COO, we learn from what so.
That's.
Very positive I think for us as we try and navigate the tough environment.
Great. Okay take advantage here thanks for the.
Okay.
Yeah true.
Thank you well take our next question from Felicia Hendrix with Barclays.
[noise] hi, Thanks, I didn't get the but you guys. The happy Hanukkah, So I want it to get back in queue.
[laughter] no I shouldn't get out of that that's the thing is I love and I look I know, it's really early in the evening. So you might not have that much data, but I was just wondering you know given all the the restrictions you know we hear certain anecdotal things. So just wondering if you could.
Top of that and your satisfaction scores so far to the extent there are any.
Or sort of Oh with GAAP.
Yeah, I think it definitely too early tough to comment on I think you know we [noise].
I I'd say, but anecdotally I think there are a lot of people line, who you are real [laughter] outside.
Outside of the.
To be scared and people who are just looking at the you know a great opportunity for them their family the friends to be together.
You know I mean, I guess anecdotally the lot of the people, who I know talked to over time.
No. The you know I mean these are obviously people who are more the custom screen, but no everybody still wants the to come out or go to whatever resorts. They can go to so I think you.
You know having have limited options over a long period of time I think people feel like this is one that they want they.
They want and the NERC family. The still pursue you know there's definitely you know chatter about mouse wearing you know what we are going to you know doing our varied the up to have very strict compliance with base covering but but obviously just like everybody else. That's you know that is a that's good if you're probably remain as the channel.
The over the whole season, but but I think we now have you know the most of the line that we've ever had with you know all of our local community partners in terms of yeah. It's clear that the hockey's of things we have to do a lot of people also understand that we can you know that debt. There are certain things, we can't deliver and and I think they they get that.
I think one of the things we mentioned in the release and moving to talk about the little bit more of the you know why we have a lot of people with questions that are calling on call center of trying to talk to our you know reservation as you think the guy we've been overwhelmed and really don't have the infrastructure to fully support that I think that's been a probably the biggest challenge on the guest service side, we've seen one mark.
Yeah, we're obviously going to drive some fixed interest you know couldn't do that in time for after this fall, but but I would say broadly speaking, we feel real good about where we sit.
Given again the environment that we're doing.
Okay, great. Thank you.
Yep.
Thank you. This concludes today's question and answer session I would like to turn it back to management for closing remarks.
Thank you operator. This concludes our fiscal 2021 first quarter earnings call. Thanks to everyone, who joined US today. Please feel free to contact me or Michael directly should you have any further questions. Thank you for your time this afternoon and goodbye.
This concludes today's call. Thank you for your participation you may now disconnect.
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