Peak Resorts, Inc. (NASDAQ:SKIS), a leading owner
and operator of high-quality, individually branded ski resorts in
the U.S., today reported results for the first quarter of its 2016
fiscal year, which ended July 31, 2015.
Highlights include:
- Net loss was $7.1 million compared to $8.2 million in last
year's first quarter, largely due to lower interest expense.
- Reported EBITDA* for the first quarter was a loss of $6.5
million, level with last year's first quarter and in line with
management's expectations.
- Mount Snow EB-5 project reached targeted $52 million
subscription level in August and construction continues at
site.
- Columbus Day Weekend is next deadline for 2015/2016 season pass
sales; management anticipates continued strong demand for season
pass products.
Timothy D. Boyd, president and chief executive officer,
commented, "The summer months are when we plan and prepare for the
next ski season. This summer has been no different, with activity
on many fronts. Most significant has been the continued progress at
Mount Snow.
"As we announced in late August, we have received investor
commitments to fully subscribe the $52 million EB-5 capital raise
for Mount Snow with $50.8 million in escrow as of September 4,
2015. In addition, the construction work that began this summer on
the West Lake project component is proceeding well. Further, we
continue to expect approval of the first I-526 Petition in the near
future, which will allow the release of the funds in escrow."
Boyd added, "Earlier this summer, we also created a new Sales
and Marketing group for our Northeast Resorts. This group will
allow us to leverage our multiple resort presence, which we believe
will increase our overall sales in the region. Across the resort
portfolio, we continue to work to make certain the ski experience
remains top quality, with maintenance capital expenditures in
fiscal 2016 expected to be in the range of $5 million to $6 million
(exclusive of the West Lake project), about $1.4 million of which
was spent in the first quarter. Our resort teams are making certain
everything remains in tip top shape following our $59.5 million in
infrastructure investments in recent years, in particular in new
snowmaking technology.
"Overall, we are excited to be implementing our roadmap for
growth, which calls for a mix of organic growth, resort development
and acquisitions. We continue to evaluate potential value-add
acquisitions."
* See below for Definitions of Non-GAAP Measures
|
(dollars in thousands except per
share data) |
Three months ended July
31, |
|
2015 |
2014 |
|
|
|
Revenues |
$ 5,432 |
$ 5,596 |
Loss from operations |
$ (8,963) |
$ (9,076) |
Net Loss |
$ (7,079) |
$ (8,160) |
Loss per share (basic and diluted) |
$ (0.51) |
$ (2.05) |
Weighted average shares
outstanding |
13,982 |
3,982 |
Reported EBITDA |
$ (6,515) |
$ (6,445) |
Three-Month Resort Operating Results
Stephen J. Mueller, Peak Resorts' chief financial officer,
noted, "Total revenue and resort operating expenses both declined
slightly in the first quarter. Through July 31, higher revenue from
the zipline rider attraction at the Attitash resort did not offset
lower food and beverage revenue related to the termination of a
restaurant lease at our Big Boulder resort in March 2015.
"The zipline at Attitash is proving to be a popular attraction.
We expect it to continue to attract visitors through the fall as it
gives riders a great view of the Mount Washington Valley from high
above the tree canopy. We expect a strong contribution from the
zipline to our second-quarter revenue."
|
(dollars in thousands) |
Three months ended July
31, |
|
2015 |
2014 |
|
|
|
Revenues |
|
|
Food and beverage |
$ 1,322 |
$ 1,712 |
Hotel/lodging |
$ 1,460 |
$ 1,323 |
Retail |
$ 159 |
$ 160 |
Other |
$ 2,491 |
$ 2,401 |
Total |
$ 5,432 |
$ 5,596 |
|
(dollars in thousands) |
Three months ended July
31, |
|
2015 |
2014 |
|
|
|
Resort operating expenses |
|
|
Labor and labor related
expenses |
$ 6,231 |
$ 6,259 |
Retail and food and beverage cost
of sales |
$ 516 |
$ 634 |
Power and utilities |
$ 583 |
$ 691 |
Other |
$ 2,877 |
$ 2,862 |
Total |
$ 10,207 |
$ 10,446 |
Financial Position Supports Strategy
Mueller noted, "The strength of our balance sheet at year end
has allowed us to continue to implement our strategic plan during
the summer months when our cash receipts are typically lower. At
July 31, 2015, we had $11.0 million of cash and cash equivalents,
compared to $16.8 million at April 30, 2015, reflecting normal
operating cash flow, the investment we are making at Mount Snow in
advance of the release of the EB-5 funds held in escrow, as well as
dividend and interest payments totaling $4.7 million."
Richard K. Deutsch, vice president, business and real estate
development, added, "As previously announced, we have moved ahead
with the development plan at our Mount Snow ski resort, breaking
ground in May 2015 for Phase 1 – the West Lake project. The West
Lake Project continues in full swing, with over 10 miles of pipe
installed so far this construction season. The excavation of the
physical West Lake is now 60% complete.As we have reported, we are
very pleased with the interest in and success of our EB-5 program,
which will finance this work. When we closed the program in August,
we had investor commitments to provide all of the funding and
we now have in escrow $50.8 million of the $52 million raised."
Quarterly Investor Call and Webcast
Peak Resorts will hold its first-quarter investor conference
call/webcast on Thursday, September 10, at 9 a.m. EDT.
The call/webcast will be available via:
Webcast: |
|
|
ir.peakresorts.com on the Events page |
Conference Call: |
|
|
877-292-0959 (domestic) or 412-542-4158
(international) |
A replay will be available on the Peak Resorts investor
relations website (ir.peakresorts.com) after the call
concludes.
Definitions of Non-GAAP Measures
Reported EBITDA is not a measure of financial performance under
U.S. generally accepted accounting principles ("GAAP"). The company
defines Reported EBITDA as net income before interest, income
taxes, depreciation and amortization, gain on sale/leaseback,
investment income, other income or expense and other non-recurring
items. The following table includes a reconciliation of Reported
EBITDA to net loss:
|
(dollars in thousands) |
Three months ended July
31, |
|
2015 |
2014 |
Net loss |
$ (7,079) |
$ (8,160) |
Income tax benefit |
$ (4,520) |
$ (5,171) |
Interest expense, net |
$ 2,721 |
$ 4,342 |
Depreciation and amortization |
$ 2,448 |
$ 2,306 |
Investment income |
$ (2) |
$ (4) |
Gain on sale/leaseback |
$ (83) |
$ (83) |
Non-routine legal and settlement of
lawsuit |
$ -- |
$ 325 |
Reported EBITDA |
$ (6,515) |
$ (6,445) |
We have chosen to specifically include Reported EBITDA as a
measurement of our results of operations because we consider this
measurement to be a significant indication of our financial
performance and available capital resources. Because of large
depreciation and other charges relating to our ski resorts, it is
difficult for management to fully and accurately evaluate our
financial results and available capital resources using net income.
Management believes that by providing investors with Reported
EBITDA, investors will have a clearer understanding of our
financial performance and cash flow because Reported EBITDA: (i) is
widely used in the ski industry to measure a company's operating
performance without regard to items excluded from the calculation
of such measure, which can vary by company primarily based upon the
structure or existence of their financing; (ii) helps investors to
more meaningfully evaluate and compare the results of our
operations from period to period by removing the effect of our
capital structure and asset base from our operating structure; and
(iii) is used by our management for various purposes, including as
a measure of performance of our operating entities and as a basis
for planning.
Items excluded from Reported EBITDA are significant components
in understanding and assessing financial performance or liquidity.
Reported EBITDA should not be considered in isolation or as
alternative to, or substitute for, net income, net change in cash
and cash equivalents or other financial statement data presented in
the consolidated financial statements as indicators of financial
performance or liquidity. Because Reported EBITDA is not a
measurement determined in accordance with GAAP and is susceptible
to varying calculations, Reported EBITDA as presented may not be
comparable to other similarly titled measures of other
companies.
About Peak Resorts
Headquartered in Missouri, Peak Resorts (NASDAQ:SKIS) is a
leading owner and operator of high-quality, individually branded
ski resorts in the U.S. The company currently operates 13 ski
resorts primarily located in the Northeast and Midwest, 12 of which
are company owned.
The majority of the resorts are located within 100 miles of
major metropolitan markets, including New York City, Boston,
Philadelphia, Cleveland and St. Louis, enabling day and overnight
drive accessibility. The resorts under the company's umbrella offer
a breadth of activities, services and amenities, including skiing,
snowboarding, terrain parks, tubing, dining, lodging, equipment
rentals and sales, ski and snowboard instruction and mountain
biking and other summer activities.
Forward Looking Statements
This news release contains forward-looking statements regarding
the future outlook and performance of Peak Resorts, Inc., within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements are subject to a variety of risks and
uncertainties that could cause actual results to differ materially
from current expectations. These risks and uncertainties are
discussed under the caption "Risk Factors" in the company's Annual
Report on Form 10-K for the year ended April 30, 2015, filed with
the Securities and Exchange Commission (the "SEC"), and as updated
from time to time in the company's filings with the SEC. Peak
Resorts undertakes no obligation to release publicly the result of
any revisions to these forward-looking statements that may be made
to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
Consolidated Income
Statements |
|
|
(Unaudited) |
|
Three months
ended July 31, |
|
2015 |
2014 |
|
|
|
|
|
|
Revenues |
$ 5,432 |
$ 5,596 |
Costs and Expenses |
|
|
Resort operating expenses |
10,207 |
10,446 |
Depreciation and
amortization |
2,448 |
2,306 |
General and administrative
expenses |
936 |
1,086 |
Land and building rent |
338 |
357 |
Real estate and other
taxes |
466 |
477 |
|
14,395 |
14,672 |
|
|
|
Loss from Operations |
(8,963) |
(9,076) |
|
|
|
Other Income (expense) |
|
|
Interest, net of interest
capitalized of $91 and $129 in 2015 and 2014,
respectively |
(2,721) |
(4,342) |
Gain on sale/leaseback |
83 |
83 |
Investment income |
2 |
4 |
|
(2,636) |
(4,255) |
|
|
|
Loss before income tax
benefit |
(11,599) |
(13,331) |
Income tax benefit |
(4,520) |
(5,171) |
Net Loss |
$ (7,079) |
$ (8,160) |
|
|
|
|
|
|
Basic and diluted loss per
share |
$ (0.51) |
$ (2.05) |
|
|
|
Cash dividends declared per
common share |
$ 0.1375 |
$ -- |
|
Consolidated Balance
Sheets |
|
|
(Unaudited) |
|
|
July 31, |
April 30, |
|
2015 |
2015 |
Assets |
|
|
Current assets |
|
|
Cash and cash equivalents |
$ 10,982 |
$ 16,849 |
Restricted cash balances |
43,332 |
37,519 |
Income tax receivable |
4,520 |
-- |
Accounts receivable |
663 |
1,639 |
Inventory |
1,715 |
1,583 |
Deferred income taxes |
970 |
970 |
Prepaid expenses and
deposits |
1,956 |
1,930 |
|
64,138 |
60,490 |
Property and
equipment-net |
146,185 |
143,944 |
Land held for
development |
35,780 |
35,780 |
Other assets |
1,335 |
1,326 |
|
$ 247,438 |
$ 241,540 |
Liabilities and Stockholders'
Equity |
|
|
Current liabilities |
|
|
Accounts payable and accrued
expenses |
$ 9,210 |
$ 8,218 |
Accrued salaries, wages and
related taxes and benefits |
740 |
927 |
Unearned revenue |
10,660 |
8,606 |
EB-5 investor funds in
escrow |
38,553 |
30,002 |
Current portion of deferred
gain on sale/leaseback |
333 |
333 |
Current portion of long-term
debt and capitalized lease obligation |
1,834 |
999 |
|
61,330 |
49,085 |
Long-term debt |
97,404 |
97,569 |
Capitalized lease
obligation |
4,405 |
1,494 |
Deferred gain on
sale/leaseback |
3,428 |
3,511 |
Deferred income taxes |
8,831 |
8,831 |
Other liabilities |
603 |
612 |
Commitments and
contingencies |
|
|
Stockholders' Equity |
|
|
|
|
|
Common stock, $.01 par value,
20,000,000 shares authorized, 13,982,400 and 3,982,400 shares
issued |
140 |
140 |
Additional paid-in capital |
82,538 |
82,538 |
Accumulated Deficit |
(11,241) |
(2,240) |
|
71,437 |
80,438 |
|
$ 247,438 |
$ 241,540 |
CONTACT: For Further Information:
Heather Wietzel
616-233-0500
InvestorRelations@PeakResorts.com
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