Whistler Blackcomb Holdings Inc. Reports Fiscal 2014 First Quarter Results and Announces Dividend and Capital Investments - WFLA News Channel 8

Whistler Blackcomb Holdings Inc. Reports Fiscal 2014 First Quarter Results and Announces Dividend and Capital Investments

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SOURCE Whistler Blackcomb

WHISTLER, BC, Feb. 4, 2014 /PRNewswire/ - Whistler Blackcomb Holdings Inc. (TSX: WB) (the "Corporation") today reported financial results for the three months ended December 31, 2013. The Corporation holds a 75% interest in the entities that operate Whistler Blackcomb, the largest four-season mountain resort in North America.

Highlights for the Three Months Ended December 31, 2013

  • Revenue decreased by $0.4 million to $49.8 million and Adjusted EBITDA decreased by $0.8 million to $9.5 million as a result of reduced visitation to 426,000 total visits from 489,000 total visits in the comparative quarter last year. Snowfall for the ski season to December 31, 2013 was 186 centimeters compared to the 10-year average snowfall for the same period of 472 centimeters and 560 centimeters for the same period in the prior year. Adjusted EBITDA is a non-GAAP measure and is defined below.
  • Revenue per total visit increased 14% compared to the same period in the prior year, reflecting strong growth in effective ticket price ("ETP" - see definition below) and guest spending in the Corporation's ancillary businesses.
  • Skier visits for the ski season to December 31, 2013 were comprised of 38% destination visits compared to 24% for the equivalent period in the prior year, based on the Corporation's estimates.
  • Refinancing of the Corporation's $261 million of senior secured and second lien debt with a new $300 million five-year senior secured revolving credit facility with a significantly reduced interest rate and increased flexibility.
  • Completion of construction and opening of the new Harmony 6 Express and Crystal Ridge Express ski lifts, as well as additional snowmaking infrastructure and terrain improvements on Blackcomb mountain, on time and on budget.

Dave Brownlie, the Corporation's President and Chief Executive Officer commented: "We are pleased that our revenue and Adjusted EBITDA held up well in spite of the lower than expected visitation, which demonstrates our pricing power and the resiliency of our business. Our snowmaking infrastructure allowed us to open more skiable terrain than any other resort in North America for the holiday period and the success of our pre-commitment sales program contributed positively to our results during the quarter."

Revenue, Visits and Pricing

  • Total revenue was $49.8 million for the quarter ended December 31, 2013, a decrease of $0.4 million or 1% compared to the same period in the prior year. The decrease in total revenue was primarily a result of lower lift revenue, because of lower skier visits, offset by higher ETP and revenue from the Corporation's ancillary businesses.
  • Total visits for the quarter ended December 31, 2013 were 426,000, a decrease of 63,000 visits, or 13%, compared to the same period in the prior year. Skier visits for the fiscal 2014 first quarter decreased by 15% to 391,000, which was partially offset by a 25% increase in other visits to 35,000.
  • ETP and revenue per total visit for the quarter ended December 31, 2013 were $53.52 and $116.99, respectively, an increase of $4.30 or 8.7% and $14.17 or 13.8%, respectively, over the comparative quarter in the prior year. ETP is total ski-related lift revenue divided by skier visits. This growth reflected increases in lift ticket prices, as well as increased guest spending in the Corporation's ancillary businesses. The Corporation experienced a higher proportion of destination visits in the first quarter of fiscal 2014, which contributed to the increase in revenue per visit.

Adjusted EBITDA and Loss per Share

  • Adjusted EBITDA decreased 7% to $9.5 million for the quarter ended December 31, 2013 compared to the same quarter in the prior year. The decrease in Adjusted EBITDA was driven primarily by lower revenue compared to the prior year.
  • Net loss per common share for the quarter was $0.19 (basic and diluted) compared to net loss per common share of $0.07 (basic and diluted) in the prior year. The increase in net loss per common share was principally attributable to the $5.5 million prepayment penalty and $2.8 million write-off of unamortized debt issuance costs in connection with the refinancing of the Corporation's long-term debt during the quarter.

Financial Position

  • As at December 31, 2013, the Corporation had $43.3 million of cash and cash equivalents, an increase of $1.9 million, or 5%, compared to $41.4 million at September 30, 2013. The increase in cash was mainly attributable to season pass and frequency card sales, offset in part by capital spending on the new Harmony and Crystal chairlifts and the $5.5 million penalty on the repayment of the Corporation's second lien debt during the quarter.
  • During the quarter, the Corporation entered into a new $300 million five-year senior secured revolving credit facility and repaid the first and second lien facilities in full. The Corporation's new credit facility will have an interest rate of 2.50% over the one-month banker's acceptance rate ("BA rate") until May 2014 and a rate of 2.25% over the BA rate thereafter, based on the Corporation's current leverage ratio.
  • Subsequent to quarter end, the Corporation applied $10 million of its cash balance against the new revolving credit facility and reduced the principal amount outstanding to $251 million.

Outlook

  • As at February 2, 2014, skier visits were 846,000, a decrease of 8.6% compared to the same period in the prior year.
  • Management estimates that total skier visits to date were comprised of 60% regional guests and 40% destination guests, compared to 70% and 30%, respectively, for the prior year.
  • As at February 2, 2014, the Corporation's 2013-14 seasons pass and frequency cards sales were $41.4 million, a 3% increase over season pass and frequency cards sales at the same time during the 2012-13 season.

Capital Investments

The Corporation also announced the following strategic capital investments that are expected to be substantially completed in the 2014 fiscal year:

  • $6.0 million for a major upgrade of the Whistler Village Gondola, including the replacement of the original cabins with 160 new eight passenger seated cabins. The Village Gondola is the primary access point to Whistler Mountain from Whistler Village and the new cabins will dramatically improve guest experience and increase capacity by 12%.
  • $5.9 million for several information technology initiatives, including a new enterprise resource planning ("ERP") system and radio-frequency identification ("RFID") system with lift access control gates on most mountain lifts. The ERP system is one of the final steps for the Corporation to bring its IT infrastructure in-house from a third-party service provider. The installation of the RFID gates is expected to reduce lift ticket fraud and will provide the Corporation with the infrastructure required to offer enhanced guest engagement and marketing opportunities.

In respect of these investments, Dave Brownlie commented: "These capital projects represent the first phase of investment after our debt refinancing and are designed to improve guest experience and provide us with the necessary infrastructure and capacity to continue to grow our ski and non-ski businesses."

Dividend

The Corporation's Board of Directors has declared a dividend of $0.24375 per common share for the first quarter, to be paid on February 19, 2014 to shareholders of record on February 14, 2014. This dividend will be an eligible dividend for Canadian income tax purposes.

Non-GAAP Measures

This press release makes reference to Adjusted EBITDA, which is a measure not prescribed by Canadian generally accepted accounting principles, or "GAAP". This non-GAAP measure does not have a standardized meaning and is therefore unlikely to be comparable to similar measures presented by other companies. Adjusted EBITDA is defined as consolidated loss from operations before depreciation and amortization, as well as items that management does not consider part of the Corporation'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 or restructuring 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 Corporation's results of operations from management's perspective. It is also a supplemental measure of performance that highlights trends in the Corporation's business that may not otherwise be apparent when relying solely on GAAP financial measures. The closest GAAP measure is net loss 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 Corporation's annual information form dated December 20, 2013 (the "AIF") and management's discussion and analysis ("MD&A"), which are available on the Corporation's website and on SEDAR at www.sedar.com, for additional details regarding non-GAAP measures.

Reconciliation of Net Loss to Adjusted EBITDA

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

             
(In thousands)    Three
months
ended
December
31, 2013
      Three
months
ended
December
31, 2012
            (Recast)1
Net loss $ (12,296)     $ (5,613)
Depreciation and amortization   10,524       10,646
Finance expense, long term debt   11,967       4,251
Finance expense, Limited Partner's interest   1,925       1,900
Income tax benefit   (2,601)       (942)
Non-cash loss on disposal of fixed assets   1       11
Adjusted EBITDA $   9,520     $ 10,253

1Refer to the Corporation's MD&A for the 3 months ended December 31, 2013 for a description of the recast.

Conference Call Information

Management will conduct a conference call on February 4, 2014 at 6:00 a.m. Pacific Time / 9:00 a.m. Eastern Time to review the Corporation's fiscal 2014 first 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 replay of the call will be archived for 30 days on the Presentations section of the Corporation's website.

ABOUT WHISTLER BLACKCOMB HOLDINGS INC.

Whistler Blackcomb Holdings Inc. owns a 75% interest in each of Whistler Mountain Resort Limited Partnership and Blackcomb Skiing Enterprises Limited Partnership, which, together, carry on the four season mountain resort business located in the Resort Municipality of Whistler, British Columbia.  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 1,180 centimetres (465 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 Corporation's website at www.whistlerblackcombholdings.com or SEDAR at www.sedar.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements or information, within the meaning of applicable Canadian securities laws, which may prove to be incorrect. The forward-looking statements and information contained in this press release include comments about interest cost savings, investments in ski and non-ski businesses, positioning for the 2013-14 ski season, principal outstanding on credit facilities, lift ticket fraud reduction, replacement of the Whistler Village Gondola cabins, among others, and are based on certain factors and assumptions made by management of the Corporation including, but not limited to: business conditions, guest visitation, weather, macroeconomic and currency influences, and interest rates, among others.

The forward-looking statements and information contained in this press release 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, risks relating to unfavourable weather conditions, availability of capital, environmental laws and regulations, the impact of any occurring natural disasters and economic, business and market conditions. A more detailed description of these risks is available in the Corporation's most recently filed annual information form, which is available on the Corporation's website and on SEDAR at www.sedar.com.

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 Corporation 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 Corporation 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 Corporation 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.


Condensed Interim Consolidated Statements of Comprehensive Income (Loss)

(in thousands, except per share amounts)

                 
      Three months
ended
December 31,
2013
      Three months
ended
December 31,
2012
              (recast)1
               
Resort revenue   $ 49,837     $ 50,281
               
Operating expenses     32,870       32,670
Depreciation and amortization     10,524       10,646
Selling, general and administrative     7,447       7,358
      50,841       50,674
               
Loss from operations     (1,004)       (393)
               
Disposal losses     (1)       (11)
Finance expense, long term debt     (11,967)       (4,251)
Finance expense, Limited Partner's interest     (1,925)       (1,900)
               
Net loss before income tax     (14,897)       (6,555)
               
Income tax benefit     2,601       942
               
Net loss and comprehensive loss   $ (12,296)     $ (5,613)
               
Net loss and comprehensive loss:              
  Attributable to Whistler Blackcomb Holdings Inc. shareholders   $ (7,302)     $ (2,585)
  Attributable to Limited Partner's non-controlling interest     (4,994)       (3,028)
    $ (12,296)     $ (5,613)
               
Loss per share              
  Basic   $ (0.19)     $ (0.07)
  Diluted   $ (0.19)     $ (0.07)
               
Weighted average number of common shares outstanding              
  Basic     37,961       37,912
  Diluted     38,018       37,967
                 

Consolidated Statements of Financial Position

(in thousands)

                         
      December
31, 2013
      September
30, 2013
               
Assets              
               
Current assets:              
  Cash and cash equivalents   $ 43,254     $ 41,353
  Accounts receivable     9,819       3,323
  Income taxes receivable     1,660       -
  Inventory     17,055       15,856
  Prepaid expenses     3,519       2,727
  Notes receivable     456       311
      75,763       63,570
Notes receivable     2,458       2,636
Property, buildings and equipment     324,528       322,316
Property held for development     9,244       9,244
Intangible assets     308,269       311,428
Goodwill     137,259       137,259
    $ 857,521     $ 846,453
               
Liabilities and Shareholders' Equity              
               
Current liabilities:              
  Accounts payable and accrued liabilities   $ 31,746     $ 24,927
  Income taxes payable     -       1,645
  Provisions     2,823       2,858
  Deferred revenue     51,444       22,347
      86,013       51,777
Long-term debt     258,452       258,042
Deferred income tax liability     19,820       20,690
Limited Partner's interest     72,796       72,796
Total liabilities     437,081       403,305
               
Equity              
  Whistler Blackcomb Holdings Inc. shareholders' equity            
    Common shares; no par value; unlimited number authorized;            
    37,997 outstanding  (Sept 30, 2013 - 37,958)     442,531       442,080
      Additional paid-in capital     697       913
      Deficit     (71,335)       (54,781)
Total Whistler Blackcomb Holdings Inc. shareholders' equity     371,893       388,212
  Limited Partner's non-controlling interest     48,547       54,936
      420,440       443,148
    $ 857,521     $ 846,453
                         

Condensed Interim Consolidated Statements of Cash Flows

(in thousands)

               
      Three months
ended
December 31,
2013
      Three months
ended
December 31,
2012
              (recast)1
Cash provided by (used in)              
               
Operations              
               
Net loss   $ (12,296)     $ (5,613)
               
Adjustments for:              
  Income tax benefit     (2,601)       (942)
  Interest expense on long-term debt     11,967       4,251
  Interest expense on Limited Partner's interest     1,925       1,900
  Depreciation and amortization     10,524       10,646
  Disposal losses     1       11
  Share-based compensation     235       192
      9,755       10,445
               
Interest paid on long-term debt     (3,431)       (3,885)
Prepayment penalty paid on second lien facility repayment     (5,500)       -
Interest paid on Limited Partner's interest     (1,925)       (1,900)
Income taxes paid     (1,573)       (215)
Changes in non-cash operating working capital     27,394       21,534
               
      24,720       25,979
               
Financing              
Dividends paid on common shares     (9,252)       (9,240)
Distributions to Limited Partner's non-controlling interest     (1,395)       (1,413)
Repayment of long-term debt     (261,000)       -
Draws on revolving credit facility     261,000       -
Debt issuance costs     (2,627)       -
      (13,274)       (10,653)
               
Investing              
Expenditures on property, buildings, equipment and intangibles     (9,683)       (2,673)
Proceeds from sale of property and equipment     105       41
Repayment of notes receivable     33       4
      (9,545)       (2,628)
               
Cash and cash equivalents, end of period              
Increase in cash and cash equivalents     1,901       12,698
Cash and cash equivalents, beginning of period     41,353       43,634
    $ 43,254     $ 56,332

1Refer to the Corporation's MD&A for the 3 months ended December 31, 2013 for a description of the recast.

 

 

 

 

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