Peak Resorts: The New ASC?

[steamboat1]

For the fiscal year, Peak Resorts' revenue declined by 8.7%, despite its Hunter Mountain acquisition, which would have represented a 26% increase in a normal season.

This says volumes. How bad would've it been without the Hunter Mountain acquisition? More than a quarter of Peaks revenue was expected to come from one area. Guess their other areas don't generate to much.

 

[BenedictGomez]

"$15.5 million of the Hunter Mountain debt is not included in the long term debt figure."

I haven't poured over their earnings release, (and I dont intend to at 1am) but I dont understand this sentence as written. Are they just trying to say in odd wording that this debt is in current liabilities?

 

[yeggous]

For the fiscal year, Peak Resorts' revenue declined by 8.7%, despite its Hunter Mountain acquisition, which would have represented a 26% increase in a normal season.

This says volumes. How bad would've it been without the Hunter Mountain acquisition? More than a quarter of Peaks revenue was expected to come from one area. Guess their other areas don't generate to much.

It's all relative. From my perspective as a real New Englander, it is overwhelming to visit the slopeside circuses of southern Vermont. It's not hard to imagine that Hunter and Mount Snow dominate their revenue. When people pay $100 to stand in line it can be very profitable. Their other areas are in either in more remote locations, or more competitive markets.

 

[drjeff]

It's all relative. From my perspective as a real New Englander, it is overwhelming to visit the slopeside circuses of southern Vermont. It's not hard to imagine that Hunter and Mount Snow dominate their revenue. When people pay $100 to stand in line it can be very profitable. Their other areas are in either in more remote locations, or more competitive markets.

Before Hunter was added to their portfolio of resorts, Mount Snow alone on average accounted for over 40% of Peaks annual revenue. With the bulk of their holdings being small, Midwest properties, often with only essentially 3 month operating seasons, while they may not make Peak a ton of gross revenue on the balance sheets foe each of those resorts, in a "normal" year they do add up cumulatively when you combine them all together.

Take a "normal" ski season, and it's quite easy to see why adding Hunter to their portfolio will be a very good move for their annual revenues

 

[doublediamond]

Peaks is nothing like how ASC was. ASC over expanded their ski areas and assumed a lot of Mt Snow and Killington debt. ASC's business model was selling real estate and the market tanked.

Peaks is nearly entirely focused on operations. The only reason we're having this conversation is the record bad winter, they gambled on the West Lake project, and the Hunter aquisition.

With respect to this winter, it was an utter disaster. If anyone says otherwise they're nuts. Visits were down nearly 30 percent. A loss of only $3M and change despite this winter, bodes well for their long term profitability.

With respect to West Lake, it needed to get done. This is the last winter of their Haystack water rights. No West Lake? No Carinthia Park and all that revenue.

With respect to Hunter, it was a smart move that'll be a cash cow for them. It's a fully operational ski area with everything up to snuff. This isn't like Mt Snow with the lifts and snowmaking needs. This isn't like wildcat needing snowmaking. They have a huge snowmaking system that allows them to routinely open early and have 2 high speed lifts, one brand new, and the other heavily refurbished. Maybe one or two of their fixed grips will need replacement and maybe spruce up the lodge. But no major investments needed. This was a great move for their bottom line.

 

[ski&soccermom]

http://www.dvalnews.com/view/full_s...s-year?instance=secondary_stories_left_column

 

[ss20]

http://www.dvalnews.com/view/full_s...s-year?instance=secondary_stories_left_column

Guess they're putting what was pretty much certain in writing? ;-)

Bittersweet. Bitter last winter...for sure...needed that extra water. But most years? Mt. Snow has never been aggressive in snowmaking (til last season, when they were one of the most aggressive, making snow multiple weekends in March). Typically much of their snow is made from mid-November to late-January, with spot snowmaking going on till Presidents Week at the very latest. In the awesome 2014-2015 season the guns were shut down at the beginning of February.

So my question...where is the ROI? It's been stated that the plan to add coverage from the current 80% will be slow and not drastic. They'll never be at 95%+ coverage like their competitors, Stratton and Okemo.

I doubt the season will get any longer. Thanksgiving to second weekend of April is all they shoot for. Opening Day has great coverage...Closing Day has great coverage...anything less and they won't operate. Very conservative with that aspect.

So more water/pumping capacity=more trails before Christmas and quicker resurfacing. Unfortunately you can't put a number on either of those figures in a brochure. As long as that's the case I don't see the masses flocking to Mount Snow.

 

[deadheadskier]

I don't see the masses flocking to Mount Snow.

This does not compute. Don't they already? The pictures I've seen of the place on the weekends certainly meets my definition of "masses" and are enough to keep me away.

 

[yeggous]

This does not compute. Don't they already? The pictures I've seen of the place on the weekends certainly meets my definition of "masses" and are enough to keep me away.

+1. The place is an intolerable circus. I'd phrase it as the hordes will always haunt Mt Snow, regardless of the effort they put into snowmaking. Many people driving north up I-91 stop there because it is the first place over the magical Vermont border.


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[machski]

I thought they intended to add snowmaking to the Sunbrook side after West Lake is complete? That would help a bit in weak snow years. I think the goal of more water is to make as much snow as possible at the most optimum weather times. If you can make most of what you need at the most efficient temps, your costs drop. So sure, can't really sell that. But if the idea is to reduce costs, you don't really need to sell that as the revenue gain comes from the other side of the ledger.

 

[MEtoVTSkier]

This does not compute. Don't they already? The pictures I've seen of the place on the weekends certainly meets my definition of "masses" and are enough to keep me away.

Exactly... They obviously are doing something right.

 

[yeggous]

Exactly... They obviously are doing something right.

Does being is the right location count as "doing something"?


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[Newpylong]

Does being is the right location count as "doing something"?


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Only one part of the equation.

 

[drjeff]

I thought they intended to add snowmaking to the Sunbrook side after West Lake is complete? That would help a bit in weak snow years. I think the goal of more water is to make as much snow as possible at the most optimum weather times. If you can make most of what you need at the most efficient temps, your costs drop. So sure, can't really sell that. But if the idea is to reduce costs, you don't really need to sell that as the revenue gain comes from the other side of the ledger.

Yup.

The plan is to get West Lake complete, then, once permitting, which is apparently contingent to some extent in the eyes of the USFS where roughly 2/3rds of Mount Snow's trails are located is based on having the water capacity to put a million gallons of water per acre of terrain covered over the course of the season, expand their coverage not just in Sunbrook, but over the rest of the non snowmaking terrain on the mountain over a few seasons. So it hasn't been part of the plan from Day 1 to have the West Lake project and concurrent expansion to 100% snowmaking occur in the same season. Water capacity 1st, then the roll out of new snowmaking terrain over the course of a few seasons.

Additionally, the plan for Sunbrook is one the snowmaking is increased to 100% back there is to upgrade the Sunbrrok Quad to a highspeed lift and additionally construct some yurt like structure near the base of the Sunbrook and Bear Trap lifts for food and beverage sales and likely some bathroom facilities as well to hopefully encourage people to spend more time back there rather than just often using it as a pass through area on their way to other parts of the mountain

 

[MEtoVTSkier]

Does being is the right location count as "doing something"?

It definitely helps.

 

[FBGM]

Mount Blow looks to be doing it wrong still. More then halfway through summer and barley a start to their pump house project and more water now project. Also, little birdie on the interwebz said their permits may still be in the works for parts of that cluster project. Watch out ASC, peak is cumin for yas

 

[Newpylong]

 

[Jully]

Mount Blow looks to be doing it wrong still. More then halfway through summer and barley a start to their pump house project and more water now project. Also, little birdie on the interwebz said their permits may still be in the works for parts of that cluster project. Watch out ASC, peak is cumin for yas

What?

 

[drjeff]

http://ir.peakresorts.com/file/Index?KeyFile=35589792

Raising another 20 million in working capital via new stock sale per approval of the shareholders at their annual meeting in October

 

[deadheadskier]

Do they think they will have buyers? None of their recent financials would inspire me to invest. I suppose there will be some folks hoping they're buying low