Whistler (BC), Canada – Whistler Blackcomb Holdings Inc., which first became a separate ski resort entity prior to the 2010-11 winter season, today reported financial results for the fiscal 2011 third quarter and nine months ended June 30, 2011. Despite record revenues and increased skier visits throughout the season, the B.C. ski resort nonetheless tallied a C$7 million third quarter loss.
This past November 9, the corporation completed its initial public offering and concurrently acquired a 75% interest in each of Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership from Intrawest Corporation. The partnerships carry on the four season business of operating North America’s most popular ski resort.
“With our winter ski season complete we are pleased to have accomplished two key milestones. First we met our post-Olympic goal to exceed two million skier visits and second we were able to return value to our shareholders through our first three dividend payments,” said Dave Brownlie, President and Chief Operating Officer of Whistler Blackcomb. “Despite only a partial recovery in the destination market, our key indicators have returned to pre-Olympic levels with skier visit growth of 22%, effective ticket price growth of 6% and we are particularly proud of our record season pass and frequency card unit sale growth of 28% over the previous year’s ski season.”
Whistler Blackcomb was the primary alpine skiing venue during the Vancouver Olympic and Paralympic Winter Games. Following a drop in 2010 thanks to hosting the Games, skier visits and effective ticket price returned to pre-2010 levels in 2010-11. In the three months ended June 30, 2011 and the nine months ended June 30, 2011, skier visits increased by 13% and 22%, respectively, over the same periods in the prior year to 346,000 and 2.030 million. Effective ticket price decreased by 17% and increased 6%, respectively, over the same periods in the prior year to C$36.79 and C$47.06. Unit sales of season passes and frequency cards for the 2010-11 ski season increased by 28% and revenues increased to C$43.3 million, the highest level in the history of Whistler Blackcomb.
In the period from November 9, 2010 to June 30, 2011, the corporation generated C$82 million of EBITDA on revenues of C$186 million and net earnings totalled C$38 million or $1.00 per common share. In the three months ended June 30, 2011, the company generated C$3 million of EBITDA on revenues of C$31 million and net loss totaled C$7 million or C$0.18 per common share
Company officials say that the third quarter decrease in effective ticket price is primarily a result of timing of recognition of frequency card deferred revenue over the 2009-10 ski season for accounting purposes. Due to differences in estimates of frequency card usage in the third quarter, the balance of unrecognized frequency card deferred revenue at March 31, 2010 was higher than the balance at March 31, 2011. As a result, more frequency card revenue was recognized in the three months ended June 30, 2010 than in the three months ended June 30, 2011. After adjusting for this difference, effective ticket price for the three months ended June 30, 2011 was C$36.79 compared to C$36.35 for the three months ended June 30, 2010.
In the nine months ended June 30, 2011, all categories of resort revenue (e.g., lift, retail and rental, food and beverage and ski school) benefited from the increase in skier visits and effective ticket price in the 2010-11 ski season compared to the prior year’s ski season, representing a return to pre-Olympic Winter Games levels. In the prior year, the partnerships earned C$32 million from the Vancouver Olympic Organizing Committee (VANOC) under the venue agreement and this entire amount was included in the partnerships’ revenue in the nine months ended June 30, 2010.
Resort operating expenses decreased by 9% to C$22 million and increased by 7% to C$97 million for the three and nine months ended June 30, 2011, respectively, over the same periods in the prior year. The 7% increase for the nine month period was primarily attributable to increases in labor and benefit costs and other operating expenses. The increase in labor and benefit costs corresponded with the increase in skier visits in the nine month period compared to the same period in the prior year.
“As we look ahead to the 2011-12 ski season, we are confident that we will be able to sustain this past season’s regional growth and we are encouraged by the results from our recent spring season pass and frequency card campaign which saw unit sale and revenue growth over the record 2010-11 ski season,” said Brownlie. “As our management team ramps up for the upcoming season, our main focus is on increasing destination visitation to historical levels.”