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Press Release: American Skiing Company
December 15, 2005
PARK CITY, UT -- American Skiing Company (OTC Bulletin Board: AESK) yesterday announced its financial results for
the first quarter of fiscal 2006. The Company also reported stronger season pass sales than at the same time in
fiscal 2005, as well as positive guest reservation trends heading into its winter operating season. Increases in
season pass sales were driven primarily by the second successful year of its acclaimed All For One multi-resort
pass in the eastern market.
"While it is quite early in the season, we have enjoyed successes from our season pass initiatives. The second
year of our All For One pass and favorable early-season skiing and riding conditions have contributed to a great
start to the season for the Company. The East saw an October opening at Killington with the rest of our eastern
resorts opening by Thanksgiving weekend. In the West, abundant early season snowfall and cool winter temperatures
for snowmaking have created fantastic skiing and riding conditions at both The Canyons and Steamboat, with Steamboat
recording a record amount of snowfall through its early season," said CFO Betsy Wallace.
Fiscal 2006 First Quarter Results
On a GAAP basis, net loss attributable to common shareholders for the first quarter of fiscal 2006 was $42.2 million,
or $1.33 per basic and diluted common share, compared with a net loss attributable to common shareholders of $37.7
million, or $1.19 per basic and diluted common share for the first quarter of fiscal 2005. Total consolidated revenue
was $20.1 million for the first quarter of fiscal 2006, compared with $19.5 million for the first quarter of fiscal
2005. Revenue from resort operations was $17.1 million for the first quarter of fiscal 2006 compared with $17.8
million for the first quarter of fiscal 2005. The decrease in resort revenues reflects the lower levels of summer
business at the Company's eastern resorts due to rainy weather, and lower levels of group and conference business
at Steamboat and The Canyons in the first quarter of fiscal 2006. Revenue from real estate operations was $3.0
million for the quarter versus $1.7 million for the comparable period in fiscal 2005. The increase in real estate
revenue was primarily a result of increased sales of fractional unit inventory at Steamboat versus the comparable
period in fiscal 2005.
The loss from resort operations was $40.8 million for the first fiscal quarter of 2006 versus a loss of $37.1 million
for the first quarter of fiscal 2005. The wider loss was associated with the decrease in revenues mentioned above,
a $2.0 million increase in resort interest expense, a $0.4 million increase in repairs and maintenance expense
and employee benefits, a $0.7 million increase in marketing, general and administrative expenses and a $0.8 million
increase in depreciation expense due largely to a $0.7 million adjustment recorded as a result of the review of
the seasonal usage of ski resort operating assets; offset by a $0.2 million net gain on sale of property and a
$0.7 million increase in fair value of the interest rate swap agreement.
The loss from real estate operations was $1.4 million for the first fiscal quarter of 2006 compared with a loss
of $0.6 million for the comparable quarter in fiscal 2005. The increased loss was associated with a $0.8 million
increase in costs due to an increase in revenues and a $1.5 million increase in impairment loss on the sale of
retail commercial space; offset by a $1.2 million increase in revenues mentioned above, a $0.2 million decrease
in depreciation and amortization and a $0.1 million decrease in interest expense due to restructuring of real estate
debt.
About American Skiing Company
Headquartered in Park City, Utah, American Skiing Company is one of the largest operators of alpine ski, snowboard
and golf resorts in the United States. Its resorts include Killington, Pico and Mount Snow in Vermont; Sunday River
and Sugarloaf/USA in Maine; Attitash in New Hampshire; Steamboat in Colorado; and The Canyons in Utah. More information
is available on the Company's web site, www.peaks.com.
Certain statements contained in this press release constitute forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange
Act of 1934, as amended (the Exchange Act). These forward-looking statements are not based on historical facts,
but rather reflect our current expectations concerning future results and events. Similarly, statements that describe
our objectives, plans or goals are or may be forward-looking statements. We have tried, wherever possible, to identify
such statements by using words such as "anticipate", "assume", "believe", "expect",
"intend", "plan", and words and terms of similar substance in connection with any discussion
of operating or financial performance. Such forward-looking statements involve a number of risks and uncertainties.
In addition to factors discussed above, other factors that could cause actual results, performances or achievements
to differ materially from those projected include, but are not limited to, the following: changes in regional and
national business and economic conditions affecting both our resort operating and real estate operating segments;
competition and pricing pressures; adverse weather conditions regionally and nationally; changes in weather patterns
resulting from global warming; seasonal business activity; increased gas and energy prices; changes to federal,
state and local regulations affecting both our resort operating and real estate segments; failure to renew land
leases and forest service permits; disruptions in water supply that would impact snowmaking operations; the loss
of any of our executive officers or key operating personnel; and other factors listed from time to time in our
documents we have filed with the Securities and Exchange Commission. We caution the reader that this list is not
exhaustive. We operate in a changing business environment and new risks arise from time to time. The forward-looking
statements included in this press release are made only as of the date of this document and under Section 27A of
the Securities Act and Section 21E of the Exchange Act, we do not have or undertake any obligation to publicly
update any forward-looking statements to reflect subsequent events or circumstances.
American Skiing Company and Subsidiaries
Unaudited Condensed Consolidated Financial Statement Information
(in thousands, except per share amounts)
13 Weeks Ended 13 Weeks Ended
October 30, October 24,
2005 2004
Net revenues:
Resort $17,147 $17,820
Real estate 2,969 1,726
Total net revenues 20,116 19,546
Operating expenses:
Resort 23,963 23,609
Real estate 1,942 1,108
Marketing, general and
administrative 11,568 10,817
Depreciation and amortization 2,910 2,279
Gain on sale of property (169) --
Impairment loss on property sold 1,533 --
Total operating expenses 41,747 37,813
Loss from operations (21,631) (18,267)
Interest expense, net (21,254) (19,453)
Increase in fair value of interest rate
swap agreement 686 --
Net loss $(42,199) $(37,720)
Basic and diluted net loss per common share:
Net loss $(1.33) $(1.19)
Weighted average common shares
outstanding - basic and diluted 31,738 31,738
For more information, please refer to the Company's Form 10-Q, filed on December 14, 2005, with the Securities
and Exchange Commission.
American Skiing Company and Subsidiaries
Unaudited Segment Information and Reconciliation of GAAP to Non-GAAP Metrics
(in thousands)
13 Weeks Ended 13 Weeks Ended
October 30, 2005 October 24, 2004
Loss from resort operations $(40,796) $(37,122)
Loss from real estate operations (1,403) (598)
Net loss $(42,199) $(37,720)
Net loss $(42,199) $(37,720)
Gain on sale of property (169) --
Impairment loss on property sold 1,533 --
Increase in fair value of interest
rate swap agreement (686) --
Net loss excluding gain on sale of
property, impairment loss on
property sold and increase in fair
value of interest rate swap agreement $(41,521) $(37,720)
Loss from resort operations $(40,796) $(37,122)
Gain on sale of property (169) --
Increase in fair value of interest
rate swap agreement (686) --
Loss from resort operations excluding
gain on sale of property and increase
in fair value of interest rate swap
agreement $(41,651) $(37,122)
Loss from real estate operations $(1,403) $(598)
Impairment loss on property sold 1,533 --
Income (loss) from real estate
operations excluding impairment loss
on property sold $130 $(598)
American Skiing Company and Subsidiaries
Unaudited Balance Sheet Data - October 30, 2005
(in thousands)
Real estate developed for sale $21,515
Total assets $427,886
Total resort debt (a) $650,014
Total real estate debt 20,464
Total debt (a) $670,478
(a) Includes preferred stock of $321,478 as a result of the adoption of
SFAS No. 150.
Excluding preferred stock, total resort debt would be $328,536 and
total debt would be $349,000.
For more information, please refer to the Company's Form 10-Q, filed on December 14, 2005, with the Securities
and Exchange Commission.
Source: American Skiing Company