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American Skiing Company Announces Fiscal 2005 Year End and Fourth Quarter Results

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PARK CITY, Utah — Citing substantial growth in its resort operations, American Skiing Company today announced its financial results for the 2005 fiscal year and fourth quarter ended July 31, 2005. The Company reported that its fiscal 2005 resort operating results were favorably impacted by the introduction of the new All For One Pass and favorable Spring season conditions at the Company's eastern resorts, as well as a record number of skier visits at The Canyons resort. Coupled with effective pricing and yield management, the Company achieved a 7% increase in resort revenues in fiscal 2005. Other highlights of fiscal 2005 include the successful refinancing of a majority of the Company's resort debt, as well as a significant reduction in borrowings outstanding under the real estate construction loan facility.

"The secret is out on the best value in eastern skiing," commented President and CEO B.J. Fair. "Our guests have applauded the introduction of the All For One product in the East, as well as the noticeable guest service improvements at all of our resorts. I am pleased to report that these improvements have already generated a positive impact to our financial results in fiscal 2005, with significantly higher resort revenues than in the past three years. We experienced marked growth in revenues in several business lines of the Company including our Food & Beverage, Retail and Rental operations. Additionally, based on year to date results of season pass sales and booking pace to date, we are pleased about our prospects for a strong fiscal 2006."

The Company also reported season pass sales and hotel bookings for the upcoming fiscal 2006 winter operating season are pacing ahead of prior year levels.

"As we've continuously improved operations and the financial position of the Company over the last several years, we enter fiscal 2006 considerably stronger and healthier. We're in a position to look ahead to new growth opportunities and investment at our resorts in the months and years to come," added Fair.

Fiscal 2005 Fourth Quarter Results

On a GAAP basis, net loss attributable to common shareholders for the fourth quarter of fiscal 2005 was $37.3 million, or $1.17 per basic and diluted common share, compared with net income available to common shareholders of $9.9 million, or $0.13 per basic and diluted common share for the fourth quarter of fiscal 2004.

Total consolidated revenue was $15.7 million for the fourth quarter of fiscal 2005, compared with $17.0 million for the fourth quarter of fiscal 2004. Resort revenue was $13.8 million for the fourth quarter of fiscal 2005, compared with $13.6 million for the fourth quarter of fiscal 2004. Real estate revenue was $1.8 million for the fourth quarter of fiscal 2005 versus $3.4 million for the comparable period in fiscal 2004. The decrease in real estate revenue was primarily due to lower sales of fractional ownership inventory in the fourth quarter of fiscal 2005 as compared with the fourth quarter of fiscal 2004. The Company's consolidated net loss was $37.3 million for the fourth quarter of fiscal 2005, compared with consolidated net income of $9.9 million for the comparable period in fiscal 2004. Excluding other items (please see tables following this discussion), the Company's consolidated net loss was $38.4 million for the fourth quarter of fiscal 2005 versus a consolidated net loss of $38.6 million for the fourth quarter of fiscal 2004. The loss from resort operations was $36.6 million for the fourth quarter of fiscal 2005 versus a loss from resort operations of $37.4 million for the fourth quarter of fiscal 2004. Excluding other items, the loss from resort operations was $37.7 million for the fourth quarter of fiscal 2005 versus a loss of $37.4 million for the fourth quarter of fiscal 2004. The loss from real estate operations was $0.7 million for the fourth quarter of fiscal 2005, compared with income of $47.3 million for the fourth quarter of fiscal 2004. Excluding other items, loss from real estate operations was $0.7 million for the fourth quarter of fiscal 2005 versus a loss of $1.3 million for the fourth quarter of fiscal 2004. The Company has provided reconciliations from GAAP financial measures to non-GAAP financial measures in the tables following this discussion.

Fiscal 2005 Year End Results

On a GAAP basis, net loss attributable to common shareholders for the fiscal year ended July 31, 2005 was $73.3 million, or $2.31 per basic and diluted common share, compared with a net loss of $28.5 million, or $0.90 per basic and diluted common share, for fiscal 2004.

Total consolidated revenue was $276.5 million in fiscal 2005, compared with $284.1 million in fiscal 2004. Resort revenue grew seven percent to $267.3 million in fiscal 2005, compared with $250.7 million for fiscal 2004, primarily reflecting price increases and increased skier visits at the Company's resorts. Real estate revenue was $9.2 million in fiscal 2005 versus $33.4 million in fiscal 2004, reflecting the revenues resulting from the auction of remaining fractional ownership inventory at The Canyons and land parcel sales recognized in fiscal 2004.

The Company's consolidated net loss for fiscal 2005 was $73.3 million compared with a loss of $28.5 million for fiscal 2004. Excluding other items, the consolidated net loss was $68.5 million for fiscal 2005 versus $76.9 million for fiscal 2004. The loss from resort operations was $70.6 million for fiscal 2005 compared to a loss of $66.6 million for fiscal 2004. Excluding other items, the loss from resort operations was $65.8 million for fiscal 2005 versus $66.5 million for fiscal 2004, reflecting a $16.6 million increase in resort revenues, a $4.4 million decrease in marketing and general and administrative costs, offset by a $11.9 million increase in the cost of resort operations (including depreciation and amortization), and $8.4 million increase in interest expense. The loss from real estate operations was $2.7 million for fiscal 2005 compared to income of $38.1 million for fiscal 2004. Excluding other items, the loss from real estate operations was $2.7 million for fiscal 2005 versus a loss of $10.5 million for fiscal 2004, reflecting decreased interest expense and fewer sales staff following the auction of remaining fractional ownership inventory at The Canyons. The Company has provided reconciliations from GAAP financial measures to non-GAAP financial measures in the tables following this discussion.

Use of Non-GAAP Financial Information

The company uses both GAAP and non-GAAP metrics to measure its financial results. Management believes that non-GAAP financial measures which exclude certain items provide useful information to investors regarding the company's ongoing financial condition and results of operations. In particular, the company has excluded merger, restructuring and impairment charges; write-off of deferred financing costs; gain on sale of Haystack resort; increase in fair value of interest rate swap agreement; gain on extinguishment of debt and gain on transfer of assets associated with extinguishment of debt from net income or loss, income or loss from resort operations and income or loss from real estate operations, where applicable. Management believes these non-GAAP metrics are useful to investors because they remove certain items that occur in the affected periods and provide a basis for measuring the company's results of operations and financial condition against other periods. Since the company has historically reported non-GAAP results to the investment community, management also believes the inclusion of non-GAAP measures provides consistency in its financial reporting. However, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. In addition to the information contained in this press release, investors should also review information contained in the company's Form 10-K, filed on October 31, 2005, as well as other filings with the Securities and Exchange Commission when assessing the company's financial condition and results of operations. The company has provided reconciliations from GAAP financial measures to non-GAAP financial measures in the tables following this discussion.

About American Skiing Company

Headquartered in Park City, Utah, American Skiing Company (OTC: AESK - News) is one of the largest operators of alpine ski, snowboard and golf resorts in the United States. Its resorts include Killington, Pico and Mount Snow in Vermont; Sunday River and Sugarloaf/USA in Maine; Attitash in New Hampshire; Steamboat in Colorado; and The Canyons in Utah. More information is available on the Company's web site, www.peaks.com.
 

ctenidae

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How does that equal a strong fiscal year? Total loss is higher than a year ago, total revenues are down from a year ago, and real estate continues to kill them. If they weren't saddled with such an awful construction loan, I'd think they'd be seling off as much of the realestate bits as they can. Ski operations (resort revenues, rental (equipment) and food and bev) seem to be doing well, actually increasing their revenues (and turning a profit (!)), but overall they're getting killed by the real estatethey're trying to sell. Maybe if they can pay down some more of that debt, it may become practicle for someone to buy up they're real estate (as has been happening at Killington).

There's hope for them yet, just not a whole lot, and not for a while.
 
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