Ski Industry Player Vail Resorts Struggles With Stalled Targets And Environmental Uncertainties, New Report Claims

On Tuesday, American journalist Herb Greenberg said that red flags get hoisted when companies talk about targets or their "vision," then suddenly don't – and instead start mixing up metrics.

He mentions that Vail Resorts Inc MTN, a ski resort operator, like many recreational-related entities during the early stages of post-pandemic reopening, appeared to have fallen into a common trap. 

They interpreted the post-Covid numbers they witnessed as the beginning of a new trend, claims the report.

The company initially set ambitious revenue targets linked to advance pass sales, envisioning a substantial 75% lift in revenue from advance commitments. However, recent reports and statements reveal a notable stall in progress toward this vision.

In a significant shift, the company has diverted focus from lift revenues to a percentage of "all skier visits," with recent earnings calls highlighting expectations of over $900 million in revenue generated from non-refundable advance commitment products, contributing to over 73% of all skier visits, the report alleged.

Challenges exacerbated by weather-related concerns have surfaced prominently this year. Vail Resorts, known for its risk factors associated with weather in its filings, faces adverse snow conditions in several crucial locations, casting doubts on a successful ski season.

The company's reliance on natural snowfall poses significant risks, with low precipitation and warmer temperatures in various regions adversely affecting snowpack levels, according to the report. 

While Vail Resorts can produce artificial snow, this process is costly and hampered by warm conditions in certain areas, impacting operational costs and visitor experiences.

In summary, Vail Resorts is grappling with stalled targets, environmental challenges, and weather-related uncertainties, which collectively cast shadows on their financial performance and overall guest satisfaction, the report said.

Benzinga has contacted Vail Resorts for comment and will update the story with their response.

Price Action: MTN shares are down 0.40% at $221.47 on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo via Wikimedia Commons