Revenue down 16% at Peak Resorts after poor skiing weather
Peak Resorts Inc., the Wildwood-based owner and operator of ski resorts, reported a fiscal third-quarter profit of $3.7 million on revenue of $38.7 million.
Revenue in the recent quarter fell 16 percent from nearly $46 million in the prior year’s quarter.
Peak Resorts’ net income rose 13 percent in the recent quarter compared with $3.3 million in the 2015 fiscal third quarter.However, earnings from operations were nearly cut in half to $8.8 million in the three months ended Jan. 31 this year.
During the quarter, the company acquired Hunter Mountain, a New York ski resort that was known for its celebrity clientele in the 1970s and 1980s, for $36.8 million.
Hunter contributed to Peak’s visits, revenue and cash flow but not enough to overcome an overall decline in visits, which dropped 23 percent in the recent quarter, Peak Resorts President and CEO Tim Boyd said in the company’s earnings release Tuesday.
“This year’s ski season got off to a late and very choppy start due to unseasonably warm weather in both our Northeast and Midwest regions,” Boyd said.
The company now expects full-year revenue, which had been estimated at $104.9 million for the fiscal year, to be down 10-12 percent.
Boyd said a delay in the company’s $52 million EB-5 capital raise from foreign investors, “has resulted in cash balances that are lower than we had anticipated.” EB-5 is an investor visa program to stimulate the U.S. economy through foreign investments. That capital raise is earmarked for upgrades and new construction at Peak’s Mount Snow resort in West Dover, Vermont.
The Hunter acquisition also substantially changed the company’s balance sheet as total assets rose to $315.5 million while total debt rose to $125.8 million, reflecting the $21 million for the first Hunter Mountain mortgage and another $15.5 million that was borrowed, Peak CFO Stephen Mueller said.
Peak Resorts operates 14 ski resorts primarily in the Northeast and Midwest, 13 of which are company owned.
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