X

Condor Capital Management’s 2014/15 Mid-Season Ski Industry Update

Condor Capital Wealth Management’s 2014/15 Mid-Season Ski Industry Update: Mother Nature Turns a Cold, Dry Shoulder to the West as She Pummels the East

MARTINSVILLE, N.J., Feb. 24, 2015 (GLOBE NEWSWIRE) — As we near the halfway point of the season, weather across the country is causing most skiers and snowboarders to feel a sense of déjà vu according to Ken Schapiro of Condor Capital Wealth Management. The 2014/15 season kicked off with a few early season storms that brought hope across the Pacific Northwest, but that hope was soon washed away by the warm and dry reality that western skiers have become all too familiar with. Results have varied across the country, and while some resorts are reporting solid figures, others remain dormant.

In the Rockies, following last year’s stellar grades, expectations leading into the season were high. As of December 31st, the Colorado Ski Country USA (CSCUSA) reported that skier visits were roughly 1% lower on a year-over-year basis. Considering the record breaking year most of Colorado had last season, where skier visits grew at a 20% clip, these numbers are far more encouraging than they may appear to be at first, especially considering the fact that Colorado’s statewide snowpack is only 86% of its historic average. Elsewhere in the Rockies, participants’ appetite is being supported by the consistent snowfall in states such as Wyoming, where an epic 417 inches have fallen at Jackson Hole thus far.

On the other hand, in the Pacific and Pacific Northwest, many larger mountains have resorted to artificial snow making. Illustrating California’s recent struggles is Mammoth Mountain, which received no snowfall in both November and January, and in total has only received 77 inches. In line with these results, the Golden State as a whole recorded below average snowfall for the fourth year in a row. In fact, as of January 29th, the statewide snowpack is 75% lower than average, according to the California Department of Water Resources. In similar fashion, further up north, Mt. Hood is reporting a snowpack that is only 32% of normal depth. In addition to these less-than-stellar results, the drought has begun to affect Utah this year, where a disappointing 98 inches has fallen in Park City.

On the east coast, beginning in early October, the so-called "lake effect" snow dominated early season headlines. This premature weather was then eroded by a temperate and rainy December. However, beginning in late January and continuing into February, Mother Nature has provided a few epic nor’easters that have made the northeast the envy of the ski world. Even with the slow December, Maine’s Sugarloaf resort is reporting 7% growth in skier visits relative to last season, while Vermont’s Sugarbush resort is reporting a 10% boost compared to last year. Overall, the recent snowstorms seemed to have saved this season for most of New England and will likely improve skier visits enough to be comparative to last year’s results.

As an effect of this season’s weather, Vail Resorts reported that both overall revenues and skier visits were up in the early season relative to last year; however, revenues were reportedly growing at a faster pace than skier visits. Vail’s management cited particular strength in its four Colorado-based resorts – Vail, Beaver Creek, Keystone, and Breckenridge – and good momentum at its two Utah-based resorts – Park City and Canyons – with signs of weakness appearing in its Tahoe locations. Similarly, Intrawest Resort Holdings released metrics through January 4th that showed lift ticket revenue was up 8% at its two resorts in Colorado – Steamboat and Winter Park – while overall skier visits dropped by 0.8% compared to last year due to wet weather experienced at its two east coast resorts – Snowshoe and Stratton – during December. Nevertheless, these numbers will likely improve once the recent east coast snowfall factors itself into this season’s total figures.

On the retail front, according to SnowSports Industries America (SIA), early season retail sales from August 1st through October 31st came in at $699M, down 1% from last year. Outerwear sales were up 2% to $295M and accessories were up 4% to $61M, while equipment sales fell by 8% to $213M. These disappointing figures are most likely a result of the west coast’s continued struggles and the industry’s inability to attract millennials. Having said that, early season sales figures do not always correlate with total sales figures, and with a little luck, these figures can improve as we progress through the season.

As we approach the prime winter months, the 2014/15 season appears to be headed in the right direction. With an added boost in the Rockies due to the FIS Alpine World Ski Championships that were held at Vail and Beaver Creek, along with the recent spate of impressive storms along the east coast, we stand by our mid-single (3-5%) growth in skier days for the season.

Condor Capital Management

Founded in 1988, Condor Capital Wealth Management is an employee-owned, SEC-registered investment advisor based in Martinsville, N.J. employing 16 professional and support staff. Since Condor is a fee-only investment management firm, its fees are based on portfolio size, not sales commissions or number of trades. For more information on Condor Capital Wealth Management, please visit www.condorcapital.com or call 732-356-7323.