Visitation to Whistler Blackcomb (WB) over the holiday period was below owner Vail Resorts' expectations, according to a mid-season report from the Colorado-based ski-resort operator.
In a release sent to investors on Friday, Jan. 11, Vail Resorts said that results over the holidays at its roster of resorts met expectations—with the exception of WB and its Tahoe, Calif. properties, "primarily driven by increased weather variability at those resorts over the holidays and lower than expected destination and international visitation."(Vail Resorts considers destination visitors to be U.S. guests from outside of Washington State, while international guests are considered those from outside of Canada and the U.S.)
While WB doesn't share firm visitation numbers, a representative for the company, speaking on background, said that visitation leading into and over the holiday period fell just short of last year's busy winter.
Meredith Kunza, Tourism Whistler's director of research and destination development, said in an email that, although finalized numbers for December are not yet available, hotel room-night bookings for the week of Dec. 15 to 22 were pacing nine per cent behind the same period in 2017. Leading into the Christmas and New Year's holidays, room nights for the week of Dec. 23 to Jan. 2 were pacing one per cent below last year.
Kunza added that pre-holiday bookings were "likely impacted by changes to the school holiday calendar, as both B.C. and Washington public schools did not begin their breaks until the weekend before Christmas this year."
The sluggish results at WB come as Vail Resorts saw its season-to-date skier visits increase by 16.9 per cent at its entire roster of North American properties compared to the same period last year. Total lift-ticket revenue across the company was also up for the season, by 12.2 per cent, while overall ski-school revenues rose 9.5 per cent, and dining revenues were up 14.8 per cent.
As season and Epic pass sales continue to surge—Vail Resorts expects its total number of season passholders to exceed 925,000 this year—the price of its ticket-window offerings remains steep. At press time, an adult day pass for WB is priced at $169.
"It is great to see the growth across our business this season as we deliver excellent guest service at our resorts. Improved conditions across our western U.S. resorts helped drive a strong rebound in visitation and spending, particularly during the key holiday weeks," said Rob Katz, Vail Resorts CEO, in the release.
Despite the conditions, however, destination guest visitation in North America was "much lower" than anticipated in the pre-holiday period, Katz added, particularly between Dec. 1 and 21.
"We believe this was driven by destination guests' concerns from two prior years of poor pre-holiday conditions at our U.S. resorts and we did not see the pickup in short-term bookings we had expected," Katz noted.
The weather factor
The winter has been a tale of two forecasts in Whistler; for much of November, unseasonably warm weather had residents wondering when the ski season would finally get underway in earnest, while December saw a deluge of snow that ended up breaking the month's historical snowfall record, with 384 centimetres. That broke the previous record of 380 cm, set in 1994. The heavy snow also resulted in challenging road conditions, with several dumps throughout the month snarling traffic on the Sea to Sky Highway.
A spokesperson for Tourism Whistler confirmed that the organization did not see an unusual number of booking cancellations heading into the holidays.
WB was further hampered by construction delays on its new Blackcomb Gondola, which was originally slated to launch in time for the Nov. 22 Opening Day, but was postponed until mid-December. Marc Riddell, communications director for WB, said a combination of weather and technical challenges posed by the new lift—the largest of its kind in North America—led to occasional closures.
"It's going to improve. It's one of those things where you have to get a lot of flight time on it, and we're kind of doing that while the plane is moving," he explained. "It's a completely new kettle of wax for us to deal with."
Share prices drop
Whistler Blackcomb's busy winter in 2017-18 was largely credited for bolstering Vail Resorts' strong end to the fiscal year, which was impacted by historically low snowfall to start the winter at its western U.S. resorts.
Those results had the company predicting a strong start to the 2018-19 season, and investors' expectations followed suit. After falling short on its targets for the season so far, Katz said the company expects its full-year resort-reported EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) to be "slightly below" its earlier predictions of US$718 million to US$750 million.
Vail Resorts' shares fell by 13 per cent on Friday, Jan. 11 after the news was announced. At press time, Vail Resorts' shares were trading approximately 38 per cent below the company's 52-week high of US$302.76. The company's market value has fallen from US$10.1 billion in late October, to US$7.56 billion on Friday.
In a letter sent to employees, entitled "Our Stock Price," that was obtained by Pique, Vail Resorts CEO Katz said the company's strong performance in recent years has led to investors setting "the bar higher and higher. Which is awesome... but it does not mean you will always hit the higher bar.
"As our stock went from $200 per share to $300 per share over the past year, I tried not to let that get to my head," Katz continued. "Similarly, as the stock has come down, I try to make sure that does not get me off my stride. Because I know, what drives value is what we do each and every day for our guests and for each other. And I could not be more proud of how we delivered so far this season."
