Whistler Blackcomb Holdings Inc. Reports 2015 Second Quarter Results

PR Newswire

WHISTLER, BC, May 8, 2015 /PRNewswire/ - Whistler Blackcomb Holdings Inc. (WB.TO) (the "Company") today reported financial results for the three and six months ended March 31, 2015. The Company holds a 75% interest in and manages the entities that operate Whistler Blackcomb, the largest four-season mountain resort in North America.

Highlights  

  • Revenue of $191.4 million for the first six months of 2015 was 1.5% higher than revenue for the equivalent period last year as a result of a strong mix of destination skier visits this season and price improvements, both of which contributed to an 11.1% increase in revenue per visit for the first half of 2015.

  • Adjusted EBITDA of $86.4 million for the first half of 2015 was 1.9% lower than Adjusted EBITDA for the comparative period last year. Lower skier visits in 2015 were offset in part by higher revenue per visit and disciplined cost management.

  • Skier visits for the season to March 31, 2015 declined 9.3% to 1.52 million compared to the equivalent period last year, driven by fewer regional visits as a result of challenging conditions in 2015.

Dave Brownlie, the Company's President and Chief Executive Officer commented: "Our financial performance for the first half of 2015 clearly demonstrates the strength of our business while highlighting the importance of our pre-committed sales strategy.  This season we faced the second lowest snowfall in the past 36 years and some of the most challenging winter conditions in our history.  However, our unparalleled high alpine terrain, combined with our experienced snowmaking and grooming crews, delivered some of the best skiing and riding in Western North America." Mr. Brownlie continued: "The diversity of our business truly sets Whistler Blackcomb apart from other mountain resorts in North America — we kicked off our summer season with an early bike park opening on May 2 and we have extended the ski season on Whistler Mountain to June 7."

Financial & Operating Results Overview

(In thousands, except per visit amounts and Effective Ticket Price ("ETP" as defined below))



Six months ended
March 31,

Three months ended
March 31,



2015


2014

% Change


2015


2014

% Change

Visit Metrics











Skier visits


1,517


1,672

(9.3%)


1,110


1,281

(13.3%)

Other visits


70


65

7.7%


36


30

20.0%

Total visits


1,587


1,737

(8.6%)


1,146


1,311

(12.6%)












Pricing Metrics











ETP

$

62.36

$

57.11

9.2%

$

64.51

$

58.20

10.8%

Revenue per total visit

$

120.63

$

108.61

11.1%

$

119.38

$

105.88

12.7%












Financial Results











Total revenue

$

191,444

$

188,649

1.5%

$

136,805

$

138,812

(1.4%)

Operating expenses, excluding depreciation and amortization


(87,944)


(85,212)

3.2%


(53,212)


(52,342)

1.7%

Selling, general and administrative


(17,105)


(15,329)

11.6%


(7,446)


(7,882)

(5.5%)

Adjusted EBITDA

$

86,395

$

88,108

(1.9%)

$

76,147

$

78,588

(3.1%)

 

Visit, Pricing and Financial Results Summary

  • The decrease in skier visits for the three and six months ended March 31, 2015 was attributable to lower regional visitation due to unfavourable conditions at lower elevations, driven by unusually warm and wet weather and below average snowfall in the Pacific Northwest. Destination skier visits are estimated to have comprised approximately 53% and 49% of skier visits for the three and six months ended March 31, 2015, respectively, compared to approximately 42% and 41%, respectively, for the equivalent three and six month periods last year.

  • The increase in revenue per total visit for the three and six months ended March 31, 2015 reflected the strong mix of destination visits and improved pricing and guest spending in the Company's retail, rental, and snow school businesses, combined with a higher ETP. The ETP increase was attributable to increased lift ticket prices and lower utilization of pass and card products, which resulted in a higher yield on these visits. In December 2014, the Company acquired Summit Ski Limited, a complementary ski, snowboard and bike rental and retail business in Whistler, which contributed to an increase in retail and rental revenue compared to the equivalent periods last year.

  • The decrease in Adjusted EBITDA for the three and six months ended March 31, 2015 was driven by lower visitation from the regional market, partially offset by higher revenue per visit, as described above. The increase in operating expenses for both the three and six month periods ended March 31, 2015 was primarily attributable to marginally higher labour costs and retail and rental cost of sales, which increased mainly due to inflationary labour cost increases, higher sales volumes in our retail and rental and snow school businesses and the addition of Summit's operating costs. For the six months ended March 31, 2015 the increase in selling, general and administrative expenses was principally due to higher spending on marketing initiatives, which targeted key markets and resulted in stronger pre-committed sales, while disciplined cost management contributed to the reduction in SG&A for the quarter.

Treasury Summary

  • As at March 31, 2015, the Company had long-term debt outstanding of $221.0 million, a decrease of $11.0 million, or 4.7%, compared to $232.0 million at September 30, 2014. The Company's cash and cash equivalents balance at March 31, 2015 was $14.6 million compared to $8.4 million at September 30, 2014.

  • Cash interest paid during the three and six months ended March 31, 2015 decreased by 3.4% and 21.7% to $2.2 million and $4.4 million, respectively, compared to the equivalent periods in the prior year principally due to the lower interest rate on the Company's credit facility.

Season-to-Date Indicators

  • Skier visits for the 2014-15 season to May 3, 2015 were 1.74 million, down 9.1% compared to the same period in the prior year.

  • Management estimated that total skier visits to date were comprised of 51% regional guests and 49% destination guests compared to 59% and 41%, respectively, in the comparative period last year.

Dividend

The Company's Board of Directors declared a dividend of $0.24375 per common share for the second quarter, to be paid on May 29, 2015 to shareholders of record on May 22, 2015.  This dividend will be an eligible dividend for Canadian income tax purposes.

Non-GAAP Measures

This press release makes reference to Adjusted EBITDA and ETP, which are measures not prescribed by Canadian generally accepted accounting principles, or GAAP. These non-GAAP measures do not have standardized meanings and are therefore unlikely to be comparable to similar measures presented by other companies.

Adjusted EBITDA is defined as consolidated net earnings (including net earnings attributable to the 25% non-controlling interest) before interest, taxes, depreciation and amortization, as well as items that management does not consider part of the Company's normal operations, examples of which include significant non-cash gains or losses on disposal of property, buildings and equipment, acquisition or disposal expenses and gains or losses or restructuring expenses relating to acquisitions or disposals of businesses, impairment, restructuring or refinancing charges and reversals and other significant event-driven amounts as applicable. Adjusted EBITDA is provided as additional information to complement GAAP measures and to further understand the Company's results of operations from management's perspective. It is also a supplemental measure of performance that highlights trends in the Company's business that may not otherwise be apparent when relying solely on GAAP financial measures. Seventy-five percent of Adjusted EBITDA is attributable to WBHI shareholders, based on the Company's equity interest in the Partnerships. The closest GAAP measure is net earnings and a reconciliation is provided below.

ETP is defined as the Company's ski ticket yield per skier visit calculated as total ski-related lift revenue divided by total skier visits. Ski-related lift revenue and skier visits exclude revenue and visits from summer glacier skiing and other revenue amounts. The Company believes ETP is an important measure of operating performance because it allows management, investors and others to evaluate and compare the yield generated by ski lift tickets from period to period, and ski tickets are the Company's largest source of revenue and the core of its operations. The closest GAAP measure is revenue and a reconciliation is provided below. 

Non-GAAP measures should not be considered in isolation or as a substitute for analysis of financial information reported in accordance with GAAP. Readers should refer to the Company's annual information form dated December 10, 2014 and its most recent Management's Discussion & Analysis, which are available on the Company's website and under the Company's SEDAR profile at www.sedar.com, for additional details regarding non-GAAP measures.

Reconciliation of Net Earnings to Adjusted EBITDA

The following table reconciles Adjusted EBITDA to the Company's most directly comparable GAAP measure, net earnings:


(In thousands) 

Six Months

ended March

31, 2015

Six Months

ended March

31, 2014

Three months

ended March

31, 2015

Three months

ended March

31, 2014






Net earnings

$

42,085

$

39,724

$

46,658

$

52,020

Depreciation and amortization

20,946

20,636

10,618

10,112

Finance expense, long term debt

7,244

14,338

4,218

2,371

Finance expense, Limited Partner's interest

4,303

3,850

2,051

1,925

Income tax expense

12,055

11,024

12,628

13,625

EBITDA

$

86,633

$

89,572

$

76,173

$

80,053

Other income

(238)

(2,958)

(26)

(2,958)

Other expense

-

1,494

-

1,493

Adjusted EBITDA

$

86,395

$

88,108

$

76,147

$

78,588

 

The following table reconciles ETP to our most directly comparable GAAP measure, revenue:


(In thousands) 

Six Months

ended March

31, 2015

Six Months

ended March

31, 2014

Three months

ended March

31, 2015

Three months

ended March

31, 2014






Revenue

$

191,444

$

188,649

$

136,805

$

138,812

Less: Non-ski lift revenue

(96,846)

(93,169)

(65,194)

(64,258)

Total ski lift revenue

$

94,598

$

95,480

$

71,611

$

74,554

Divided by: Total skier visits

1,517

1,672

1,110

1,281

Effective Ticket Price

$

62.36

$

57.11

$

64.51

$

58.20

 

Conference Call Information

Management will conduct a conference call on May 8, 2015 at 7:30 a.m. Pacific Time / 10:30 a.m. Eastern Time to review the Company's fiscal 2015 second quarter results. The call can be accessed by dialing 1.800.319.4610 (Canada and US) or 1.604.638.5340 (International) prior to the start of the call. A live webcast and 30 day replay of the conference call will be available in the Presentation & Webcasts section of the Company's website.

ABOUT WHISTLER BLACKCOMB HOLDINGS INC.

The Company holds a 75% interest in each of Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership (the "Partnerships"), which, together, carry on the four season mountain resort business located in the Resort Municipality of Whistler, British Columbia (the "Resort Business"). The Company is the operating general partner of the Partnerships and as such manages the Resort Business. Whistler Blackcomb, the official alpine skiing venue for the 2010 Olympic Winter Games, is situated in the Coast Mountains of British Columbia, 125 kilometres (78 miles) north of Vancouver, British Columbia. North America's largest four-season mountain resort, Whistler Mountain and Blackcomb Mountain are two side-by-side mountains, connected by the world record-breaking PEAK 2 PEAK Gondola, which combined offer over 200 marked runs, over 8,000 acres of terrain, 14 alpine bowls, three glaciers, receive on average over 1,165 centimetres (459 inches) of snow annually, and offer one of the longest ski seasons in North America. In the summer, Whistler Blackcomb offers a variety of activities, including hiking and biking trails, the Whistler Mountain Bike Park, and sightseeing on the PEAK 2 PEAK Gondola. Whistler Blackcomb Holdings Inc. is listed on the Toronto Stock Exchange under the symbol "WB".  Additional information is available on the Company's website at www.whistlerblackcomb.com/holdings or under the Company's SEDAR profile at www.sedar.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release and the associated conference call and webcast, which include a business update, second quarter results and question and answer session, may contain certain forward-looking statements or information, within the meaning of applicable Canadian securities laws, which reflect the current view of the Company with respect to future events and financial performance. Forward-looking statements can often be identified by the use of forward-looking terminology such as "may", "will", "would", "could", "should", "expect", "intend", "estimate", "anticipate", "plan", "foresee", "believe" or "continue" or the negatives of such terms or variations of them or similar terminology. All forward-looking statements made by the Company are based on the opinions and estimates of management as of the date such statements are made and represent management's best judgment based on facts and assumptions that management considers reasonable. The forward-looking statements and information contained in this press release and the associated conference call and webcast are based on certain factors and assumptions made by management of the Company including, but not limited to: business conditions, guest visitation, weather, macroeconomic and currency influences, and interest rates, among others. These forward-looking statements and information contained are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated including, but not limited to, unfavourable weather conditions, unfavorable economic conditions, decreases in leisure and business travel, seasonality of operations, capital expenditures, currency fluctuations, reliance on agreements with the Province of British Columbia to operate the Resort Business, competition from other resorts, dependence on key employees and seasonal workforce, workforce risks, the impact of natural disasters, risks related to the credit facility and interest rate risks, adequacy of insurance coverage, litigation or governmental investigations, safety and accident risks, environmental laws and regulations, risks related to privacy laws, information technology and the processing of credit card information, negative publicity or unauthorized use of the Company's trademarks or tradenames, risks relating to growth projects and acquisitions, risks relating to third party interests and risks relating to an investment in the common shares of the Company, including with regard to dividend payments and future sales or issuances of common shares of the Company.  A more detailed description of these risks is available in the Company's most recently filed annual information form and management's discussion and analysis, which is available on the Company's website and at www.sedar.com under the Company's SEDAR profile.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements or information prove incorrect, actual results may vary materially from those described herein. Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, undue reliance should not be placed on forward-looking statements or information because the Company can give no assurance that such expectations will prove to be correct. 

These forward-looking statements and information are made as of the date of this press release, and the Company has no intention and assumes no obligation to update or revise any forward-looking statements or information to reflect new events or circumstances, except as required by applicable Canadian securities laws.


Whistler Blackcomb Holdings Inc.

Condensed Interim Consolidated Statements of Comprehensive Income

(in thousands, except per share amounts)




Six Months

ended March

31, 2015

Six Months

ended March

31, 2014

Three Months

ended March

31, 2015

Three Months

ended March

31, 2014













Resort Revenue


$

191,444

$

188,649

$

136,805

$

138,812







Operating expenses


87,944

85,212

53,212

52,342

Depreciation and amortization


20,946

20,636

10,618

10,112

Selling, general and administrative


17,105

15,329

7,446

7,882



125,995

121,177

71,276

70,336







Earnings from operations


65,449

67,472

65,529

68,476







Other income


238

2,958

26

2,958

Other expense


-

(1,494)

-

(1,493)

Finance expense, long term debt


(7,244)

(14,338)

(4,218)

(2,371)

Finance expense, Limited Partner's interest


(4,303)

(3,850)

(2,051)

(1,925)







Net earnings before income tax


54,140

50,748

59,286

65,645







Income tax expense


(12,055)

(11,024)

(12,628)

(13,625)







Net earnings and comprehensive income


$

42,085

$

39,724

$

46,658

$

52,020







Net earnings and comprehensive income:













Attributable to Whistler Blackcomb Holdings Inc. shareholders


$

32,005

$

29,524

$

33,274

$

36,826


Attributable to Limited Partner's non-controlling interest


10,080

10,200

13,384

15,194



$

42,085

$

39,724

$

46,658

$

52,020







Earnings per share






Basic


$

0.84

$

0.78

$

0.87

$

0.97

Diluted


$

0.83

$

0.77

$

0.86

$

0.96







Weighted average number of common shares outstanding






Basic


38,034

37,990

38,042

38,020

Diluted


38,545

38,114

38,656

38,237

 

Whistler Blackcomb Holdings Inc.

Condensed Interim Consolidated Statements of Financial Position

(in thousands)



March 31, 

2015

September 30,

2014

Assets




Current assets





Cash and cash equivalents


$

14,550

$

8,410


Accounts receivable


10,280

4,496


Inventory


18,484

18,633


Prepaid expenses


3,004

3,985


Notes receivable


153

145



46,471

35,669

Notes receivable


624

777

Property, buildings and equipment


319,837

319,897

Property held for development


9,244

9,244

Intangible assets


295,445

300,778

Goodwill


142,440

137,354



$

814,061

$

803,719





Liabilities and Shareholders' Equity




Current liabilities





Accounts payable and accrued liabilities


$

27,006

$

25,715


Income taxes payable


9,457

2,403


Provisions


1,760

2,139


Deferred revenue


14,742

27,610



52,965

57,867

Other liabilities


3,490

-

Long-term debt


218,677

229,855

Deferred income tax liability


23,713

21,974

Limited Partner's liability


72,796

72,796

Total liabilities


371,641

382,492

Share capital


443,202

442,879

Contributed surplus


1,060

919

Deficit


(60,487)

(73,949)

Total Whistler Blackcomb Holdings Inc. shareholders' equity


383,775

369,849

Non-controlling interest


58,645

51,378



442,420

421,227



$

814,061

$

803,719

 

Whistler Blackcomb Holdings Inc.

Condensed Interim Consolidated Statements of Cash Flows

(in thousands)



Six months

ended March

31, 2015

Six months

ended March

31, 2014





Cash provided by (used in)








Operations








Net earnings and comprehensive income


$

42,085

$

39,724





Adjustments for:





Income tax expense


12,055

11,024


Finance expense on long-term debt


7,244

14,338


Finance expense on Limited Partner's interest


4,303

3,850


Depreciation and amortization


20,946

20,636


Disposal losses (gains)


(105)

14


Share-based compensation


464

390



86,992

89,976





Interest paid on long-term debt


(4,438)

(5,668)

Prepayment penalty paid on second lien facility repayment


-

(5,500)

Finance expense paid on Limited Partner's interest


(4,567)

(1,925)

Income taxes paid


(3,413)

(2,635)

Changes in non-cash operating working capital


(16,346)

(15,606)







$

58,228

$

58,642





Financing




Dividends paid on common shares


(18,543)

(18,522)

Distributions to Limited Partner's non-controlling interest


(2,813)

(1,395)

Repayment of long-term debt


(18,000)

(305,000)

Draws on revolving credit facility


7,000

261,000

Debt issuance costs


(382)

(2,627)



$

(32,738)

$

(66,544)





Investing




Expenditures on property, buildings, equipment and intangibles


(19,671)

(15,827)

Proceeds from sale of property and equipment


176

196

Repayment of notes receivable


145

175



$

(19,350)

$

(15,456)





Cash and cash equivalents, end of period




Increase (decrease) in cash and cash equivalents


6,140

(23,358)

Cash and cash equivalents, beginning of period


8,410

41,353



$

14,550

$

17,995

 

View Comments (0)