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SOURCE Vail Resorts, Inc.
BROOMFIELD, Colo., March 6, 2013 /PRNewswire/ -- Vail Resorts, Inc. (NYSE: MTN) today announced its calendar 2013 capital expenditure plan. The Company's 2013 capital plan includes a high-impact new lift, significant terrain expansion, a new restaurant and the fourth generation of EpicMix, as well as $25 million in spending for the first phase of its new summer operations and nearly $10 million in upgrades for each of the recently acquired Afton Alps and Mt. Brighton, resulting in the largest number of planned improvements in the Company's history. The Company currently anticipates it will spend approximately $130 million to $140 million in resort capital expenditures in calendar year 2013, including approximately $47 million to $52 million in maintenance capital, which is necessary to maintain the appearance and level of service appropriate to resort operations, including routine replacement of snow grooming equipment and rental fleet equipment. All of the proposed capital projects are subject to applicable regulatory approvals, including U.S. Forest Service approval.
Highlights of the calendar year 2013 capital expenditure plan include:
The Company has historically invested significant cash in capital expenditures for resort operations and believes the calendar 2013 capital plan maintains the high-quality standards for which Vail Resorts is known and invests in improvements across the Company's resorts and new growth opportunities. All discretionary capital improvements are evaluated based on an expected level of return on investment. The Company plans to utilize cash on hand, borrowings available under its Credit Agreement and/or cash flow generated from future operations to provide the cash necessary to execute its capital plans.
Commenting on the resort capital expenditure announcement, Rob Katz, chief executive officer, said, "The 2013 capital plan is unprecedented in its size and underscores our operating philosophy of continually reinvesting in our resorts to offer the absolute highest quality experience to our guests and highlights several of our unique growth opportunities in Epic Discovery and newly acquired resorts. Our commitment to continually investing in our resorts to enhance the guest experience grows our season pass programs that create customer loyalty, supports our premium pricing strategy, drives new visitation, and increases guest spending. This year's plan represents the culmination of many years of hard work with recent regulatory approvals allowing for projects such as Epic Discovery and the Peak 6 terrain expansion at Breckenridge, as well as a focused acquisition strategy that allows for a stronger connection to skiers and riders in Minneapolis and Detroit."
About Vail Resorts, Inc. (NYSE: MTN)
Vail Resorts, Inc., through its subsidiaries, is the leading mountain resort operator in the United States. The Company's subsidiaries operate the mountain resorts of Vail, Beaver Creek, Breckenridge and Keystone in Colorado; Heavenly, Northstar and Kirkwood in the Lake Tahoe area of California and Nevada; Afton Alps in Minnesota and Mt. Brighton in Michigan; and the Grand Teton Lodge Company in Jackson Hole, Wyoming. The Company's subsidiary, RockResorts, a luxury resort hotel company, manages casually elegant properties. Vail Resorts Development Company is the real estate planning, development and construction subsidiary of Vail Resorts, Inc. Vail Resorts is a publicly held company traded on the New York Stock Exchange (NYSE: MTN). The Vail Resorts company website is www.vailresorts.com and consumer website is www.snow.com.
Statements in this press release, other than statements of historical information, are forward looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include estimates of capital expenditures, expected returns on those investments, expected cash flows from operations and borrowing availability under our Credit Agreement. All forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Such risks and uncertainties include but are not limited to prolonged weakness in general economic conditions, including adverse affects on the overall travel and leisure related industries; unfavorable weather conditions or natural disasters; adverse events that occur during our peak operating periods combined with the seasonality of our business; competition in our mountain and lodging businesses; our ability to grow our resort and real estate operations; our ability to successfully initiate, complete, and sell, new real estate development projects and achieve the anticipated financial benefits from such projects; further adverse changes in real estate markets; continued volatility in credit markets; our ability to obtain financing on terms acceptable to us to finance our real estate development, capital expenditures and growth strategy; our reliance on government permits or approvals for our use of Federal land or to make operational and capital improvements; demand for planned summer activities and our ability to successfully obtain necessary approvals and construct the planned improvements; adverse consequences of current or future legal claims; our ability to hire and retain a sufficient seasonal workforce; willingness of our guests to travel due to terrorism, the uncertainty of military conflicts or outbreaks of contagious diseases, and the cost and availability of travel options; negative publicity which diminishes the value of our brands; our ability to integrate and successfully realize anticipated benefits of acquisitions or future acquisitions; implications arising from new Financial Accounting Standards Board ("FASB")/governmental legislation, rulings or interpretations; and other risks detailed in the Company's filings with the Securities and Exchange Commission, including the "Risk Factors" section of the Company's Annual Report on Form 10-K for the fiscal year ended July 31, 2012.
All forward-looking statements attributable to us or any persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. All guidance and forward-looking statements in this press release are made as of the date hereof and we do not undertake any obligation to update any forecast or forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by law.
Statement Concerning Non-GAAP Financial Measures
This press release includes the estimated incremental Mountain Reported EBITDA impact of our summer activity effort. Mountain Reported EBITDA is a non-GAAP financial measure used by the Company, which we define as segment net revenue less segment operating expense plus or minus segment equity investment income or loss. Mountain Reported EBITDA may not be comparable to similarly titled measures of other companies and should not be considered in isolation or an alternative to, or substitute for, measures of financial performance or liquidity prepared in accordance with GAAP. We refer you to the Company's periodic reports filed with the SEC, including the Company's Quarterly Report on Form 10-Q for the quarter ended January 31, 2013 filed as of the date of this press release, for further information regarding the Company's use of this non-GAAP financial measure and a reconciliation of the Company's historical Mountain Reported EBITDA to its GAAP results.
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