Vail Resorts(MTN) - 2025 Q4 - Annual Report

PART I Item 1. Business Vail Resorts operates through Mountain, Lodging, and Real Estate segments, with the Mountain segment generating 89% of net revenue from 42 resorts and pass products - Vail Resorts' operations are primarily driven by its Mountain segment (89% of net revenue), followed by Lodging (11%) and Real Estate (0%)[19] - The Mountain segment operates 42 destination mountain resorts and regional ski areas, including five of the top ten most visited resorts in the U.S. for the 2024/2025 ski season[23][43] - Pass products generated approximately 65% of total lift revenue and 75% of total visitation (excluding complimentary access) for Fiscal 2025, driving customer loyalty and revenue stability[49] - The company acquired a controlling interest in Crans-Montana in Fiscal 2024 and Andermatt-Sedrun in Fiscal 2022, expanding its network into Europe[34][51] - Vail Resorts launched a two-year Resource Efficiency Transformation Plan in September 2024, aiming to generate $100 million in annualized cost efficiencies by the end of fiscal year 2026, involving position eliminations representing less than 2% of the total workforce[85][86] General This section provides an overview of Vail Resorts' business structure and operational segments Mountain Segment The Mountain segment encompasses 42 resorts offering diverse winter and summer activities, lift tickets, ski school, dining, and retail/rental services Our Competitive Strengths The company highlights its competitive advantages, including premier resorts, data-driven marketing, capital investments, and pass products Exceptional Mountain Experience Vail Resorts focuses on delivering high-quality mountain experiences through diverse terrain, modern infrastructure, and guest services Extraordinary Service and Amenities The company provides premium services and amenities across its resorts, enhancing the guest experience Lodging and Real Estate This section covers the company's lodging and real estate operations, which complement its mountain resort business Lodging Segment The Lodging segment manages luxury hotels, condominiums, and National Park Service concessioner properties Real Estate Segment The Real Estate segment focuses on developing and selling real estate properties adjacent to or within its resorts Marketing and Sales Vail Resorts employs data-driven marketing and sales strategies, particularly for its pass products, to drive customer engagement Seasonality The business experiences significant seasonality, with most revenue generated during the second and third fiscal quarters Sustainability & Social Responsibility The company outlines its commitment to environmental sustainability and social responsibility initiatives across its operations Human Capital Management Vail Resorts details its approach to managing human capital, including employee housing and resource efficiency Mountain Safety The company prioritizes mountain safety through various programs and operational protocols for guests and employees Employee Housing Vail Resorts addresses employee housing challenges through various initiatives to support its workforce Resource Efficiency Transformation The company is implementing a plan to achieve significant cost efficiencies and optimize resource utilization Intellectual Property This section describes the company's intellectual property, including trademarks and brand protection strategies Environmental Compliance and other Laws and Regulations Vail Resorts details its compliance with environmental laws and other regulations impacting its operations Contracts with Governmental Authorities for Resort Operations The company operates many resorts under special use permits and long-term leases with governmental authorities Available Information This section provides details on where to access the company's public filings and other information Item 1A. Risk Factors The company faces diverse risks including economic downturns, adverse weather, cybersecurity threats, seasonality, and challenges from international operations and acquisitions - Key business risks include prolonged weakness in economic conditions, high inflation, elevated interest rates, and unfavorable weather or climate change impacts[15][128][129][130][131] - The Epic Coverage program, while offering value to pass holders, exposes the company to significant refund obligations and potential negative customer perception if qualifying events occur[15][134][136] - Cyberattacks and disruptions to IT systems are growing risks, intensified by AI technologies, potentially leading to business disruption, data loss, and reputational harm[15][140][141][142] - The business is highly seasonal, with 82% of Mountain and Lodging net revenue earned in the second and third fiscal quarters, making it vulnerable to adverse events during peak periods[144][327] - International operations, including recent acquisitions in Europe, expose the company to risks such as currency exchange rate fluctuations, changing governmental policies, and compliance with international laws[15][180][184] Risks Related to Our Business This section details specific risks impacting the company's operations, including economic, weather, and operational challenges General Risk Factors This section outlines broader risks that could affect the company's overall business and financial performance Item 1B. Unresolved Staff Comments There are no unresolved staff comments to report - No unresolved staff comments were reported[205] Item 1C. Cybersecurity Vail Resorts maintains a robust cybersecurity program, overseen by the Board and Audit Committee, adhering to NIST and ISO frameworks, with no material incidents reported - The company's cybersecurity program is overseen by the Board and Audit Committee, adhering to NIST and ISO frameworks[207][211] - Cybersecurity risk management includes tabletop exercises, audits, vulnerability scans, penetration tests, and employee training, with cyber security insurance in place[209] - An Incident Response Plan (IRP) is maintained for investigating, containing, and mitigating incidents, with communication protocols for senior management[210] - The CIO and VP of Information Security, with over 27 years of experience each, lead the cybersecurity risk management program[214][215] Risk Management and Strategy This section outlines the company's approach to identifying, assessing, and mitigating cybersecurity risks through various strategies Cybersecurity Governance This section describes the oversight structure and responsibilities for the company's cybersecurity program, including Board involvement Item 2. Properties Vail Resorts owns or leases numerous properties for its ski resort, lodging, and related operations across the U.S., Canada, Australia, and Switzerland, often under Special Use Permits or long-term leases - The company's properties include 42 ski resorts and regional ski areas, luxury hotels, condominiums, and National Park Service concessioner properties[20][21][220][364][366] - Many U.S. ski resorts operate on federal land under Special Use Permits (SUPs) from the U.S. Forest Service, with expiration dates ranging from 2029 to 2058[95][97] - International properties include Whistler Blackcomb (Canada) under Master Development Agreements expiring in 2077, Australian resorts (Perisher, Falls Creek, Hotham) under long-term leases expiring between 2031 and 2058, and Swiss resorts (Andermatt-Sedrun, Crans-Montana) under various leasehold and concession agreements[102][108][110][112][114][115][116][119][121][122][365] Item 3. Legal Proceedings Vail Resorts is involved in ordinary course lawsuits, with adequate insurance and accruals, and no expected material adverse financial impact - The company is a party to various lawsuits arising in the ordinary course of business[224][491] - Management believes adequate insurance coverage and accruals are in place for estimable and probable loss contingencies, and current claims are not expected to materially impact financial results[224][491] Item 4. Mine Safety Disclosures This item is not applicable to Vail Resorts, Inc - Mine Safety Disclosures are not applicable to the company[225] PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Vail Resorts' common stock (MTN) trades on the NYSE, with 35.9 million shares outstanding, a $2.22 per share dividend, and an ongoing share repurchase program - As of September 24, 2025, 35,884,970 shares of common stock were outstanding, held by approximately 228 holders of record[7][226] - The Board approved a cash dividend of $2.22 per share payable on October 27, 2025, continuing its practice of quarterly dividends[190][227][302][421] Share Repurchase Activity (Q4 Fiscal 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | | :--------------------------- | :------------------------------- | :--------------------------- | :---------------------------------------------------------------- | :-------------------------------------------------------------------- | | May 1, 2025 - May 31, 2025 | — | — | — | 2,826,437 | | June 1, 2025 - June 30, 2025 | 1,286,620 | $155.45 | 1,286,620 | 1,539,817 | | July 1, 2025 - July 31, 2025 | — | — | — | 1,539,817 | | Total | 1,286,620 | $155.45 | 1,286,620 | 1,539,817 | Total Shareholder Return (July 31, 2020 - July 31, 2025) | | As of July 31, 2020 | As of July 31, 2021 | As of July 31, 2022 | As of July 31, 2023 | As of July 31, 2024 | As of July 31, 2025 | | :------------------------------ | :------------------ | :------------------ | :------------------ | :------------------ | :------------------ | :------------------ | | Vail Resorts, Inc. | $100.00 | $116.51 | $92.40 | $94.94 | $76.48 | $63.46 | | Russell 2000 | $100.00 | $138.48 | $118.64 | $127.97 | $146.17 | $146.16 | | Standard & Poor's 500 | $100.00 | $164.90 | $157.22 | $177.64 | $216.97 | $225.56 | | Dow Jones U.S. Travel and Leisure | $100.00 | $129.66 | $105.59 | $138.95 | $144.40 | $153.50 | Market and Stockholders This section provides information on the trading market for the company's common stock and its stockholder base Dividend Policy This section outlines the company's approach to cash dividends and recent dividend declarations Repurchase of Equity Securities This section details the company's share repurchase program and recent repurchase activity Performance Graph This section presents a comparison of the company's cumulative total shareholder return against selected indices Item 6. Reserved This item is reserved and contains no information Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Fiscal 2025 saw 2% Resort Reported EBITDA growth despite a 3% skier visit decline, driven by pass pricing; net income reached $280 million, supported by a $100 million efficiency plan and strong liquidity - Resort Reported EBITDA increased by 2% in Fiscal 2025, despite a 3% decline in total skier visits across North American destination mountain resorts and regional ski areas[248] - The company's resource efficiency transformation plan is expected to generate $100 million in annualized cost efficiencies by the end of fiscal year 2026[85][162][248] - Pass product sales for the 2025/2026 North American ski season decreased approximately 3% in units but increased approximately 1% in sales dollars through September 19, 2025, benefiting from a 7% price increase[248] - Total capital plan for calendar year 2025 is expected to be approximately $249 million to $254 million, including $46 million for European growth and $5 million for real estate projects[288] - As of July 31, 2025, the company had $3.2 billion in total indebtedness, with most principal payments not due until fiscal year 2029 and beyond, and was in compliance with all financial covenants[191][292][304] Overview This section provides a high-level summary of the company's financial performance and strategic initiatives Recent Trends, Risks and Uncertainties This section discusses current market trends, potential risks, and uncertainties impacting the company's financial outlook Results of Operations This section analyzes the company's financial results across its operating segments for the reported periods Summary This section offers a concise summary of the key financial outcomes and performance drivers Mountain Segment This section details the financial performance and operational highlights of the Mountain segment Fiscal 2025 compared to Fiscal 2024 This section compares the Mountain segment's financial results between Fiscal 2025 and Fiscal 2024 Lodging Segment This section details the financial performance and operational highlights of the Lodging segment Fiscal 2025 compared to Fiscal 2024 This section compares the Lodging segment's financial results between Fiscal 2025 and Fiscal 2024 Real Estate Segment This section details the financial performance and operational highlights of the Real Estate segment Fiscal 2025 This section presents the Real Estate segment's financial results for Fiscal 2025 Fiscal 2024 This section presents the Real Estate segment's financial results for Fiscal 2024 Other Items This section discusses additional financial items not covered in segment-specific analyses Reconciliation of Non-GAAP Measures This section provides reconciliations of non-GAAP financial measures to their most directly comparable GAAP measures Liquidity and Capital Resources This section analyzes the company's cash position, debt, and ability to fund operations and investments Fiscal 2025 compared to Fiscal 2024 This section compares the company's liquidity and capital resources between Fiscal 2025 and Fiscal 2024 Significant Sources of Cash This section identifies the primary inflows of cash for the company's operations and investments Significant Uses of Cash This section identifies the primary outflows of cash for the company's operations and investments Material Cash Requirements This section outlines the company's significant future cash obligations and commitments Share Repurchase Program This section discusses the company's share repurchase activities and remaining authorization Dividend Payments This section details the company's dividend payments to shareholders Covenants and Limitations This section describes the financial covenants and restrictions associated with the company's debt agreements Off Balance Sheet Arrangements This section discloses any material off-balance sheet transactions or obligations Critical Accounting Policies This section highlights the accounting policies requiring significant judgment and estimation New Accounting Standards This section discusses recently adopted or issued accounting standards and their potential impact Seasonality and Quarterly Results This section explains the seasonal nature of the business and its impact on quarterly financial performance Item 7A. Quantitative and Qualitative Disclosures About Market Risk Vail Resorts' market risks include interest rate fluctuations on $1.0 billion variable-rate debt and foreign currency exchange rates from international operations, without hedging - As of July 31, 2025, the company had approximately $1.0 billion of net variable-rate indebtedness (30% of total debt), with a 100-basis point change in borrowing rates impacting annual interest payments by $9.6 million[328] - The company is exposed to foreign currency translation risk from its Canadian, Australian, and Swiss operations, but does not currently use hedging arrangements[329] Foreign Currency Translation Adjustments and Intercompany Loan Gains/Losses (in thousands) | | Year ended July 31, 2025 | Year ended July 31, 2024 | Year ended July 31, 2023 | | :---------------------------------------- | :----------------------- | :----------------------- | :----------------------- | | Foreign currency translation adjustments | $21,948 | $(67,384) | $(25,439) | | Foreign currency gain (loss) on intercompany loans | $20 | $(4,140) | $(2,907) | Item 8. Financial Statements and Supplementary Data This section presents audited consolidated financial statements for Fiscal 2025, 2024, and 2023, including balance sheets, income, equity, and cash flow statements, with management's report on internal controls and notes - Management concluded that the company's internal control over financial reporting was effective as of July 31, 2025[335] - The consolidated financial statements for Fiscal 2024 and 2023 were revised to correct immaterial errors related to EPR Secured Notes accounting and certain capital projects[393][394][510] Consolidated Statements of Operations (in thousands) | | Year Ended July 31, 2025 | Year Ended July 31, 2024 | Year Ended July 31, 2023 | | :------------------------------------------ | :----------------------- | :----------------------- | :----------------------- | | Total net revenue | $2,964,347 | $2,885,191 | $2,889,364 | | Total segment operating expense | $2,129,908 | $2,065,964 | $2,057,702 | | Income from operations | $559,960 | $488,849 | $504,420 | | Income before provision for income taxes | $402,397 | $339,755 | $370,416 | | Net income attributable to Vail Resorts, Inc. | $280,004 | $231,105 | $265,825 | | Basic net income per share | $7.54 | $6.10 | $6.70 | | Diluted net income per share | $7.53 | $6.09 | $6.69 | Consolidated Balance Sheets (in thousands) | Assets | July 31, 2025 | July 31, 2024 | | :------------------------------------ | :------------ | :------------ | | Total current assets | $1,049,790 | $901,961 | | Property, plant and equipment, net | $2,374,654 | $2,418,530 | | Goodwill, net | $1,675,215 | $1,677,975 | | Total assets | $5,777,885 | $5,686,573 | | Liabilities | | | | Total current liabilities | $1,667,626 | $1,106,540 | | Long-term debt, net | $2,594,765 | $2,731,492 | | Total liabilities | $5,023,981 | $4,661,695 | | Total stockholders' equity | $753,904 | $1,024,878 | Consolidated Statements of Cash Flows (in thousands) | Cash Flows from Operating Activities | Year Ended July 31, 2025 | Year Ended July 31, 2024 | Year Ended July 31, 2023 | | :----------------------------------- | :----------------------- | :----------------------- | :----------------------- | | Net cash provided by operating activities | $554,870 | $589,022 | $637,855 | | Net cash used in investing activities | $(204,497) | $(241,069) | $(273,167) | | Net cash used in financing activities | $(242,647) | $(577,036) | $(914,000) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $119,356 | $(236,030) | $(553,014) | | Cash, cash equivalents and restricted cash: End of period | $456,419 | $337,063 | $573,093 | Management's Report on Internal Control Over Financial Reporting This section presents management's assessment of the effectiveness of the company's internal control over financial reporting Report of Independent Registered Public Accounting Firm This section includes the independent auditor's report on the company's financial statements and internal control over financial reporting Consolidated Balance Sheets This section presents the company's financial position, including assets, liabilities, and equity, at specific points in time Consolidated Statements of Operations This section details the company's revenues, expenses, and net income over specific reporting periods Consolidated Statements of Comprehensive Income This section presents the company's comprehensive income, including net income and other comprehensive income items Consolidated Statements of Stockholders' Equity This section details changes in the company's equity accounts, including common stock, retained earnings, and other reserves Consolidated Statements of Cash Flows This section reports the cash generated and used by the company's operating, investing, and financing activities Notes to Consolidated Financial Statements This section provides detailed explanations and additional information supporting the consolidated financial statements 1. Organization and Business This note describes the company's organizational structure and primary business activities 2. Summary of Significant Accounting Policies This note outlines the key accounting principles and methods used in preparing the financial statements 3. Revenues This note provides a breakdown of revenue streams and related accounting policies 4. Leases This note details the company's lease arrangements and their financial statement impact 5. Net Income per Common Share This note presents the calculation of basic and diluted net income per common share 6. Long-Term Debt This note provides details on the company's long-term debt obligations, including maturities and interest rates 7. Acquisitions This note describes recent business acquisitions and their financial impact 8. Supplementary Balance Sheet Information This note provides additional details on specific balance sheet accounts 9. Fair Value Measurements This note describes the fair value hierarchy and measurements of financial instruments 10. Income Taxes This note provides information on the company's income tax expense, deferred taxes, and tax rates 11. Commitments and Contingencies This note discloses significant contractual commitments and potential contingent liabilities 12. Segment and Geographic Area Information This note provides financial data segmented by business operations and geographic regions 13. Share Repurchase Program This note details the company's share repurchase activities and remaining authorization 14. Stock Compensation Plan This note describes the company's stock-based compensation arrangements 15. Retirement and Profit Sharing Plans This note provides information on the company's employee retirement and profit-sharing plans 16. Revision of Previously Issued Consolidated Financial Statements This note explains the revisions made to prior period financial statements due to immaterial errors Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure There were no changes in or disagreements with accountants on accounting and financial disclosure to report - No changes in or disagreements with accountants on accounting and financial disclosure were reported[516] Item 9A. Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and internal control over financial reporting were effective as of July 31, 2025, including Crans-Montana - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of July 31, 2025[518] - Management assessed and concluded that the company's internal control over financial reporting was effective as of July 31, 2025[335] - The assessment of internal control over financial reporting for July 31, 2025, now includes Crans-Montana, acquired in May 2024[521] Disclosure Controls and Procedures This section describes the company's controls designed to ensure timely and accurate public disclosures Management's Annual Report on Internal Control Over Financial Reporting This section presents management's assessment of the effectiveness of the company's internal control over financial reporting Attestation Report of the Independent Registered Public Accounting Firm This section includes the independent auditor's report on management's assessment of internal control over financial reporting Changes in Internal Control Over Financial Reporting This section reports any material changes in the company's internal control over financial reporting Item 9B. Other Information This section reports the termination of a Rule 10b5-1 trading plan by William Rock and an amendment to the Whistler Credit Agreement, extending its maturity to 2030 - William Rock, President, Mountain Division, terminated a Rule 10b5-1 trading plan on June 9, 2025, for the sale of up to 2,112 shares[523][524] - The Whistler Credit Agreement was amended on September 24, 2025, extending its maturity to September 24, 2030, and reducing the total commitment from C$300.0 million to C$250.0 million[525] Director and Officer Rule 10b5-1 Trading Arrangements This section discloses changes in trading plans for directors and officers under Rule 10b5-1 Whistler Credit Agreement This section details amendments to the credit agreement related to Whistler Blackcomb operations Item 9C. Disclosure Reporting Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable to Vail Resorts, Inc - Disclosure Reporting Regarding Foreign Jurisdictions that Prevent Inspections is not applicable to the company[527] PART III Item 10. Directors, Executive Officers and Corporate Governance Information regarding directors, executive officers, and corporate governance is incorporated by reference from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information on directors, executive officers, and corporate governance is incorporated by reference from the 2025 Proxy Statement[529] Item 11. Executive Compensation Information regarding executive compensation is incorporated by reference from the company's definitive Proxy Statement for the 2025 Annual Meeting of Stockholders - Information on executive compensation is incorporated by reference from the 2025 Proxy Statement[529] Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information on security ownership of beneficial owners and management is incorporated by reference from the company's 2025 Proxy Statement - Information on security ownership and related stockholder matters is incorporated by reference from the 2025 Proxy Statement[530] Item 13. Certain Relationships and Related Transactions, and Director Independence Information on certain relationships, related transactions, and director independence is incorporated by reference from the company's 2025 Proxy Statement - Information on certain relationships, related transactions, and director independence is incorporated by reference from the 2025 Proxy Statement[531] Item 14. Principal Accounting Fees and Services Information on principal accounting fees and services is incorporated by reference from the company's 2025 Proxy Statement - Information on principal accounting fees and services is incorporated by reference from the 2025 Proxy Statement[531] PART IV Item 15. Exhibits, Financial Statement Schedules This section lists all exhibits and financial statement schedules filed with the 10-K report, including various agreements, plans, and certifications - The report includes an index to financial statements (Item 8) and an index to exhibits, with schedules omitted if not required or presented elsewhere[534][536] - Exhibits include transaction agreements, corporate governance documents, debt indentures, credit agreements (e.g., Vail Holdings, Whistler), and various incentive and compensation plans[535][537][538] Item 16. Form 10-K Summary This item indicates that no Form 10-K Summary is provided - No Form 10-K Summary is provided[540]