Delaware |
46-3681098 |
(State or Other Jurisdiction of |
(I.R.S. Employer |
Incorporation or Organization) |
Identification No.) |
1621 18th Street, Suite 300 |
|
Denver, Colorado |
80202 |
(Address of Principal Executive Offices) |
(Zip Code) |
(303) 749-8200 | |
(Registrant’s Telephone Number, Including Area Code) |
Large accelerated filer |
o |
Accelerated filer |
o | |
Non-accelerated filer |
x |
(Do not check if a smaller reporting company) |
Smaller reporting company |
o |
PART I |
FINANCIAL INFORMATION
|
|
PART II |
OTHER INFORMATION
|
|
| ||
SIGNATURES |
1 |
• |
weakness in general economic conditions; |
• |
lack of adequate snowfall and unfavorable weather conditions; |
• |
adverse events that occur during our peak operating periods; |
• |
our failure to achieve the expected benefits of our recent acquisition and other risks associated with our acquisition strategy; |
• |
Steamboat Ski & Resort’s dependence on subsidized direct air service; |
• |
risks related to information technology; |
• |
our potential failure to maintain the integrity of our customer or employee data; |
• |
adverse consequences of ongoing legacy litigation or future legal claims; |
• |
our ability to monetize real estate assets; |
• |
a partial or complete loss of Alpine Helicopters Inc.’s services; |
• |
the effects of climate change on our business operations; |
• |
our ability to maintain effective internal control over financial reporting; |
• |
risks of foreign currency fluctuations which could reduce the U.S. dollar value of our Canadian earnings; |
• |
risks associated with the ownership of a majority of our outstanding common stock by entities managed or controlled by Fortress Investment Group, LLC, (collectively “Fortress”), including potential sales of shares held by Fortress, governance rights in our stockholders' agreement with Fortress and potential conflicts of interests; and |
• |
our substantial leverage, which could adversely affect our ability to raise additional capital to support our growth strategy. |
2 |
March 31, 2015 |
June 30, 2014 | ||||||
Assets |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
133,703 |
|
$ |
56,020 |
| |
Restricted cash |
14,163 |
|
12,154 |
| |||
Receivables, net of allowances of $1,925 and $4,183 |
33,383 |
|
40,408 |
| |||
Other current assets |
60,226 |
|
60,789 |
| |||
Total current assets |
241,475 |
|
169,371 |
| |||
Property, plant and equipment, net of accumulated depreciation of $391,304 and $388,729 |
530,018 |
|
490,138 |
| |||
Real estate held for development |
144,276 |
|
152,949 |
| |||
Intangible assets, net of accumulated amortization of $57,746 and $59,015 |
57,298 |
|
58,521 |
| |||
Goodwill |
106,268 |
|
94,609 |
| |||
Other long-term assets, net of allowances of $1,062 and $2,442 |
62,738 |
|
130,457 |
| |||
Total assets |
$ |
1,142,073 |
|
$ |
1,096,045 |
| |
Liabilities and Equity |
|||||||
Current liabilities: |
|||||||
Accounts payable and accrued liabilities |
$ |
82,945 |
|
$ |
62,534 |
| |
Deferred revenue and deposits |
47,956 |
|
55,688 |
| |||
Capital lease obligations due within one year |
3,525 |
|
3,929 |
| |||
Long-term debt due within one year |
7,002 |
|
6,644 |
| |||
Total current liabilities |
141,428 |
|
128,795 |
| |||
Long-term capital lease obligations |
34,802 |
|
35,597 |
| |||
Long-term debt |
569,266 |
|
513,864 |
| |||
Other long-term liabilities |
71,911 |
|
85,895 |
| |||
Total liabilities |
817,407 |
|
764,151 |
| |||
Commitments and contingencies (Note 11) |
|||||||
Stockholders' equity: |
|||||||
Preferred stock, $0.01 par value; 300,000,000 shares authorized;
0 issued and outstanding at each of March 31, 2015 and June 30, 2014 |
— |
|
— |
| |||
Common stock, $0.01 par value; 2,000,000,000 shares authorized;
45,182,677 and 45,026,124 shares issued and outstanding at March 31, 2015
and June 30, 2014, respectively
|
452 |
|
450 |
| |||
Additional paid-in capital |
2,896,408 |
|
2,894,072 |
| |||
Accumulated deficit |
(2,713,381 |
) |
(2,760,027 |
) | |||
Accumulated other comprehensive income |
140,635 |
|
197,723 |
| |||
Total stockholders' equity |
324,114 |
|
332,218 |
| |||
Noncontrolling interest |
552 |
|
(324 |
) | |||
Total equity |
324,666 |
|
331,894 |
| |||
Total liabilities and equity |
$ |
1,142,073 |
|
$ |
1,096,045 |
|
3 |
INTRAWEST RESORTS HOLDINGS, INC. |
||
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | ||
(In thousands, except share and per share data) | ||
(Unaudited) |
Three Months Ended March 31, |
Nine Months Ended March 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
Statements of Operations |
||||||||||||||||
Revenue |
$ |
321,824 |
|
$ |
285,852 |
|
$ |
516,999 |
|
$ |
468,341 |
| ||||
Operating expenses |
169,523 |
|
157,474 |
|
395,864 |
|
369,478 |
| ||||||||
Depreciation and amortization |
14,767 |
|
13,969 |
|
44,065 |
|
41,111 |
| ||||||||
(Gain) loss on disposal of assets and impairment of real estate |
(1,083 |
) |
212 |
|
(1,126 |
) |
632 |
| ||||||||
Loss on remeasurement of equity method investment |
— |
|
— |
|
1,454 |
|
— |
| ||||||||
Income from operations |
138,617 |
|
114,197 |
|
76,742 |
|
57,120 |
| ||||||||
Interest expense, net |
(10,731 |
) |
(10,134 |
) |
(30,547 |
) |
(157,413 |
) | ||||||||
Earnings (loss) from equity method investments |
2,452 |
|
6,670 |
|
(305 |
) |
3,127 |
| ||||||||
Loss on extinguishment of debt |
— |
|
— |
|
— |
|
(35,480 |
) | ||||||||
Other (expense) income, net |
(315 |
) |
336 |
|
(770 |
) |
(644 |
) | ||||||||
Income (loss) before income taxes |
130,023 |
|
111,069 |
|
45,120 |
|
(133,290 |
) | ||||||||
Income tax expense (benefit) |
230 |
|
77 |
|
(2,386 |
) |
374 |
| ||||||||
Net income (loss) |
129,793 |
|
110,992 |
|
47,506 |
|
(133,664 |
) | ||||||||
Income attributable to noncontrolling interest |
1,099 |
|
1,514 |
|
860 |
|
860 |
| ||||||||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
128,694 |
|
$ |
109,478 |
|
$ |
46,646 |
|
$ |
(134,524 |
) | ||||
Weighted average shares of common stock outstanding: |
||||||||||||||||
Basic |
45,143,142 |
|
43,791,722 |
|
45,070,917 |
|
42,509,281 |
| ||||||||
Diluted |
45,143,142 |
|
43,896,000 |
|
45,144,260 |
|
42,509,281 |
| ||||||||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. per share: |
||||||||||||||||
Basic |
$ |
2.85 |
|
$ |
2.50 |
|
$ |
1.03 |
|
$ |
(3.16 |
) | ||||
Diluted |
$ |
2.85 |
|
$ |
2.49 |
|
$ |
1.03 |
|
$ |
(3.16 |
) | ||||
Statements of Comprehensive Income (Loss) |
||||||||||||||||
Net income (loss) |
$ |
129,793 |
|
$ |
110,992 |
|
$ |
47,506 |
|
$ |
(133,664 |
) | ||||
Other comprehensive loss (net of tax of $0) |
(28,228 |
) |
(11,998 |
) |
(57,072 |
) |
(12,216 |
) | ||||||||
Comprehensive income (loss) |
101,565 |
|
98,994 |
|
(9,566 |
) |
(145,880 |
) | ||||||||
Comprehensive income attributable to noncontrolling interest |
1,121 |
|
1,563 |
|
876 |
|
926 |
| ||||||||
Comprehensive income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
100,444 |
|
$ |
97,431 |
|
$ |
(10,442 |
) |
$ |
(146,806 |
) |
4 |
INTRAWEST RESORTS HOLDINGS, INC. |
||
Condensed Consolidated Statements of Cash Flows |
||
(In thousands) |
||
(Unaudited) |
Nine Months Ended March 31, | |||||||
2015 |
2014 | ||||||
Cash provided by (used in): |
|||||||
Operating activities: |
|||||||
Net income (loss) |
$ |
47,506 |
|
$ |
(133,664 |
) | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|||||||
Depreciation and amortization |
44,065 |
|
41,111 |
| |||
Loss on extinguishment of debt |
— |
|
35,480 |
| |||
Accrued interest on notes payable to affiliates |
— |
|
119,858 |
| |||
Funding of pension plans |
(2,646 |
) |
(258 |
) | |||
Other non-cash expense, net |
4,577 |
|
9,451 |
| |||
Changes in assets and liabilities, net of Blue Mountain acquisition: |
|||||||
Receivables |
8,516 |
|
789 |
| |||
Inventories |
266 |
|
(6,186 |
) | |||
Real estate held for development |
762 |
|
11,675 |
| |||
Accounts payable and accrued liabilities |
13,909 |
|
13,916 |
| |||
Deferred revenue and deposits |
(8,495 |
) |
(10,542 |
) | |||
Other assets and liabilities, net |
(3,240 |
) |
(5,076 |
) | |||
Net cash provided by operating activities |
105,220 |
|
76,554 |
| |||
Investing activities: |
|||||||
Capital expenditures |
(34,521 |
) |
(36,929 |
) | |||
Purchase of land for development |
— |
|
(2,941 |
) | |||
Acquisition of Blue Mountain, net of cash received |
(41,467 |
) |
— |
| |||
Other investing activities, net |
(634 |
) |
(2,560 |
) | |||
Net cash used in investing activities |
(76,622 |
) |
(42,430 |
) | |||
Financing activities: |
|||||||
Proceeds from issuance of long-term debt |
59,925 |
|
534,600 |
| |||
Repayments of bank and other borrowings |
(7,787 |
) |
(585,766 |
) | |||
Net proceeds from initial public offering |
— |
|
28,480 |
| |||
Financing costs paid |
(1,234 |
) |
(17,985 |
) | |||
Contributions from affiliates |
— |
|
49,984 |
| |||
Net cash provided by financing activities |
50,904 |
|
9,313 |
| |||
Effect of exchange rate changes on cash |
(1,819 |
) |
(1,331 |
) | |||
Increase in cash and cash equivalents |
77,683 |
|
42,106 |
| |||
Cash and cash equivalents, beginning of period |
56,020 |
|
59,775 |
| |||
Cash and cash equivalents, end of period |
$ |
133,703 |
|
$ |
101,881 |
| |
Supplemental information: |
|||||||
Cash paid for interest |
$ |
26,441 |
|
$ |
31,247 |
| |
Non-cash investing and financing activities: |
|||||||
Property, plant and equipment financed by capital lease obligations |
$ |
107 |
|
$ |
19,565 |
| |
Exchange of Tranche B Term Loans and Affiliate Loans for equity interest |
$ |
— |
|
$ |
1,471,627 |
|
5 |
6 |
1. |
Organization and Business |
7 |
2. |
Significant Accounting Policies |
8 |
March 31, 2015 |
June 30, 2014 | ||||||||||||||
Carrying Value |
Fair Value |
Carrying Value |
Fair Value | ||||||||||||
Senior Debt |
$ |
573,321 |
|
$ |
598,726 |
|
$ |
516,924 |
|
$ |
548,046 |
| |||
Other debt obligations |
2,947 |
|
2,555 |
|
3,584 |
|
3,114 |
|
9 |
3. |
Revision of Previously Issued Financial Statements |
• |
The Company incorrectly recognized revenue on initiation fees related to memberships in a private club. The revenue should have been recognized over the expected useful life of the private club. The impact of this error was a decrease in revenue of $0.4 million for each of the three and nine months ended March 31, 2014 and an increase in deferred revenue of $3.1 million for the year ended June 30, 2014. |
• |
The Company did not properly record the present value of its future liability for initiation fee refunds. The impact of this error was an increase to other long-term liabilities of $5.5 million for the year ended June 30, 2014 and a corresponding increase in interest expense of $0.2 million and $0.5 million for the three and nine months ended March 31, 2014, respectively. |
• |
The Company also corrected other immaterial errors including (i) timing of certain helicopter depreciation expense, (ii) amortization of deferred losses related to a terminated interest rate hedge, (iii) classification of discounts and complimentary usage on heli-skiing trips, and (iv) timing of expenses associated with a self-insurance liability. |
Selected Items |
As Previously Reported |
Revision Adjustment |
As Revised | |||||||||
Consolidated Balance Sheet |
||||||||||||
(in thousands) |
Presentation as of June 30, 2014 | |||||||||||
Total current liabilities |
$ |
128,096 |
|
$ |
699 |
|
$ |
128,795 |
| |||
Total liabilities |
770,696 |
|
(6,545 |
) |
764,151 |
| ||||||
Total equity |
340,774 |
|
(8,880 |
) |
331,894 |
|
10 |
Selected Items |
As Previously Reported |
Revision Adjustment |
As Revised | |||||||||
Consolidated Statement of Operations and Comprehensive Income |
||||||||||||
(in thousands) |
Presentation as of the three months ended March 31, 2014 | |||||||||||
Revenue |
$ |
287,216 |
|
$ |
(1,364 |
) |
$ |
285,852 |
| |||
Operating expenses |
158,469 |
|
(995 |
) |
157,474 |
| ||||||
Depreciation and amortization |
15,122 |
|
(1,153 |
) |
13,969 |
| ||||||
Income from operations |
113,413 |
|
784 |
|
114,197 |
| ||||||
Net income |
110,400 |
|
592 |
|
110,992 |
|
Consolidated Statement of Operations and Comprehensive Loss |
||||||||||||
(in thousands) |
Presentation as of the nine months ended March 31, 2014 | |||||||||||
Revenue |
$ |
469,883 |
|
$ |
(1,542 |
) |
$ |
468,341 |
| |||
Operating expenses |
369,391 |
|
87 |
|
369,478 |
| ||||||
Depreciation and amortization |
42,265 |
|
(1,154 |
) |
41,111 |
| ||||||
Income from operations |
57,595 |
|
(475 |
) |
57,120 |
| ||||||
Net loss |
(133,385 |
) |
(279 |
) |
(133,664 |
) |
Consolidated Statement of Cash Flows |
||||||||||||
(in thousands) |
Presentation as of the nine months ended March 31, 2014 | |||||||||||
Net cash provided by operating activities |
$ |
76,604 |
|
$ |
(50 |
) |
$ |
76,554 |
| |||
Effect of exchange rate changes on cash |
(1,381 |
) |
50 |
|
(1,331 |
) |
4. |
Earnings (Loss) Per Share |
11 |
Three Months Ended March 31, |
Nine Months Ended March 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
Basic EPS |
||||||||||||||||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
128,694 |
|
$ |
109,478 |
|
$ |
46,646 |
|
$ |
(134,524 |
) | ||||
Weighted average common shares outstanding |
45,143 |
|
43,792 |
|
45,071 |
|
42,509 |
| ||||||||
Basic EPS |
$ |
2.85 |
|
$ |
2.50 |
|
$ |
1.03 |
|
$ |
(3.16 |
) | ||||
Diluted EPS |
||||||||||||||||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
128,694 |
|
$ |
109,478 |
|
$ |
46,646 |
|
$ |
(134,524 |
) | ||||
Weighted average common shares outstanding |
45,143 |
|
43,792 |
|
45,071 |
|
42,509 |
| ||||||||
Dilutive effect of stock awards |
— |
|
104 |
|
73 |
|
— |
| ||||||||
Weighted average dilutive shares outstanding |
45,143 |
|
43,896 |
|
45,144 |
|
42,509 |
| ||||||||
Diluted EPS |
$ |
2.85 |
|
$ |
2.49 |
|
$ |
1.03 |
|
$ |
(3.16 |
) |
March 31, 2015 |
|
Fiscal Year End June 30, 2014 | |||||
| |||||||
Trade receivables |
$ |
29,743 |
|
$ |
37,988 |
| |
Loans, mortgages and notes receivable |
5,565 |
|
6,603 |
| |||
Allowance for doubtful accounts |
(1,925 |
) |
(4,183 |
) | |||
Total current receivables |
$ |
33,383 |
|
$ |
40,408 |
|
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||
Inventories |
$ |
35,195 |
|
$ |
37,282 |
| |
Capital spares |
11,115 |
|
11,160 |
| |||
Prepaid expenses |
8,713 |
|
8,469 |
| |||
Prepaid insurance |
4,745 |
|
3,721 |
| |||
Other assets |
458 |
|
157 |
| |||
Total other current assets |
$ |
60,226 |
|
$ |
60,789 |
|
12 |
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||
Equity method investments |
$ |
28,370 |
|
$ |
87,282 |
| |
Long-term receivables |
27,505 |
|
36,406 |
| |||
Other long-term assets |
7,925 |
|
9,211 |
| |||
Allowance for doubtful accounts |
(1,062 |
) |
(2,442 |
) | |||
Total other long-term assets |
$ |
62,738 |
|
$ |
130,457 |
|
March 31, 2015 |
|
Fiscal Year End June 30, 2014 | |||||
| |||||||
Trade payables |
$ |
73,720 |
|
$ |
54,151 |
| |
Other payables and accrued liabilities |
9,225 |
|
8,383 |
| |||
Total accounts payable and accrued liabilities |
$ |
82,945 |
|
$ |
62,534 |
|
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||
Season pass and other deferred revenue |
$ |
24,120 |
|
$ |
32,204 |
| |
Lodging and tour deposits |
20,064 |
|
15,171 |
| |||
Deposits on real estate sales |
3,772 |
|
8,313 |
| |||
Total current deferred revenue and deposits |
$ |
47,956 |
|
$ |
55,688 |
|
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||
Pension liability, net of funded assets |
$ |
32,181 |
|
$ |
39,098 |
| |
Forgivable government grants |
9,019 |
|
11,460 |
| |||
Deferred revenue and deposits |
9,269 |
|
10,934 |
| |||
Other long-term liabilities |
21,442 |
|
24,403 |
| |||
Total other long-term liabilities |
$ |
71,911 |
|
$ |
85,895 |
|
13 |
6. |
Long-Term Debt |
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||||
Maturity |
|||||||||
Senior Debt |
2020 |
$ |
573,321 |
|
$ |
516,924 |
| ||
Other debt obligations |
2015-2023 |
2,947 |
|
3,584 |
| ||||
Total |
576,268 |
|
520,508 |
| |||||
Less: Long-term debt due within one year |
7,002 |
|
6,644 |
| |||||
Total long-term debt |
$ |
569,266 |
|
$ |
513,864 |
|
14 |
2016 |
$ |
7,002 |
| |
2017 |
7,056 |
| ||
2018 |
6,131 |
| ||
2019 |
6,138 |
| ||
2020 |
6,145 |
| ||
Thereafter |
563,273 |
|
15 |
7. |
Accumulated Other Comprehensive Income |
Nine Months Ended March 31, | |||||||
2015 |
2014 | ||||||
Accumulated other comprehensive income, June 30 |
$ |
197,723 |
|
$ |
148,570 |
| |
Restructuring transactions on December 9, 2013 |
— |
|
52,670 |
| |||
Other comprehensive income (loss): |
|||||||
Foreign currency translation adjustments |
(57,957 |
) |
(14,592 |
) | |||
Realized portion on cash flow hedge (net of tax of $0) (a) |
1,458 |
|
2,737 |
| |||
Actuarial loss on pensions (net of tax of $0) (b) |
(589 |
) |
(427 |
) | |||
Accumulated other comprehensive income, March 31 |
$ |
140,635 |
|
$ |
188,958 |
|
(a) |
Amount reclassified out of AOCI is included in interest expense in the accompanying condensed consolidated statements of operations. |
(b) |
Amount reclassified out of AOCI is included in operating expenses in the accompanying condensed consolidated statements of operations. |
8. |
Share-Based Compensation |
Number of Awards |
Weighted Average
Grant Date Fair Value | |||||
Total unvested awards - July 1, 2014 |
784,727 |
|
$ |
11.97 |
| |
Granted |
45,834 |
|
8.72 |
| ||
Vested |
(219,282 |
) |
12.00 |
| ||
Forfeited |
(269,484 |
) |
12.00 |
| ||
Total unvested awards - March 31, 2015 |
341,795 |
|
$ |
11.49 |
|
16 |
Expected stock price volatility |
32.5 |
% | |
Expected term (in years) |
6.3 |
| |
Risk-free interest rate |
1.8 |
% | |
Dividend yield |
0.0 |
% | |
Weighted average fair value per option |
$ |
3.46 |
|
9. |
Income Taxes |
17 |
|
As of September 19, 2014 | ||
Consideration transferred: |
| ||
Cash paid for purchase price |
$ |
51,786 |
|
Cash paid for working capital adjustment |
2,989 |
| |
Previously held equity interest: |
| ||
Fair value of previously held equity interest on date of acquisition |
54,775 |
| |
Total consideration transferred |
$ |
109,550 |
|
|
As of September 19, 2014 | ||
Assets acquired: |
| ||
Cash and cash equivalents |
$ |
13,308 |
|
Receivables |
1,931 |
| |
Other current assets |
5,516 |
| |
Property, plant and equipment |
85,751 |
| |
Intangibles |
8,661 |
| |
Goodwill |
13,201 |
| |
Other long-term assets |
5 |
| |
Total assets acquired |
128,373 |
| |
Liabilities assumed: |
| ||
Accounts payable and accrued liabilities |
13,777 |
| |
Deferred revenue and deposits |
5,046 |
| |
Net identifiable assets acquired |
$ |
109,550 |
|
18 |
Purchase Price |
Estimated Useful Life in Years | ||||
Intangible assets: |
|||||
Trademarks and trade names |
$ |
4,107 |
|
20 | |
Customer relationships |
4,554 |
|
4 | ||
Total intangible assets |
$ |
8,661 |
|
|
Three Months Ended March 31, 2015 |
Nine Months Ended March 31, 2015 | |||||
Revenue |
$ |
33,014 |
|
$ |
49,388 |
| |
Net income attributable to Intrawest Resorts Holdings, Inc. |
$ |
13,603 |
|
$ |
13,763 |
|
Three Months Ended March 31, |
Nine Months Ended March 31, | ||||||||||||||
2015 |
2014 |
2015 |
2014 | ||||||||||||
Revenue |
$ |
321,824 |
|
$ |
321,081 |
|
$ |
530,160 |
|
$ |
535,206 |
| |||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
128,694 |
|
$ |
112,734 |
|
$ |
45,526 |
|
$ |
(134,378 |
) | |||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. per share: |
|||||||||||||||
Basic |
$ |
2.85 |
|
$ |
2.57 |
|
$ |
1.01 |
|
$ |
(3.16 |
) | |||
Diluted |
$ |
2.85 |
|
$ |
2.57 |
|
$ |
1.01 |
|
$ |
(3.16 |
) |
11. |
Commitments and Contingencies |
19 |
March 31, 2015 |
Fiscal Year End June 30, 2014 | ||||||||||||||
CAD |
USD Equivalent |
CAD |
USD Equivalent | ||||||||||||
Loans |
$ |
2,303 |
|
$ |
1,816 |
|
$ |
2,358 |
|
$ |
2,210 |
| |||
Grants |
|||||||||||||||
Received |
89,298 |
|
70,408 |
|
89,298 |
|
83,691 |
| |||||||
Future advances |
31,421 |
|
24,774 |
|
31,421 |
|
29,448 |
| |||||||
Total grants |
$ |
120,719 |
|
$ |
95,182 |
|
$ |
120,719 |
|
$ |
113,139 |
|
20 |
12. |
Related Party Transactions |
13. |
Segment Information |
21 |
22 |
Three Months Ended March 31, |
Nine Months Ended March 31, | ||||||||||||||
2015 |
2014 |
2015 |
2014 | ||||||||||||
Revenue: |
|||||||||||||||
Mountain |
|||||||||||||||
Lift (1) |
$ |
133,550 |
|
$ |
110,291 |
|
$ |
173,091 |
|
$ |
144,898 |
| |||
Lodging |
25,065 |
|
19,210 |
|
48,538 |
|
36,667 |
| |||||||
Ski School (2) |
23,391 |
|
20,825 |
|
31,762 |
|
27,950 |
| |||||||
Retail and Rental |
30,599 |
|
25,038 |
|
51,796 |
|
41,944 |
| |||||||
Food and Beverage |
31,426 |
|
27,469 |
|
50,294 |
|
42,490 |
| |||||||
Other |
14,061 |
|
12,251 |
|
33,579 |
|
30,374 |
| |||||||
Total Mountain revenue |
258,092 |
|
215,084 |
|
389,060 |
|
324,323 |
| |||||||
Adventure revenue |
44,579 |
|
50,376 |
|
77,437 |
|
84,409 |
| |||||||
Real Estate revenue |
17,635 |
|
18,876 |
|
47,858 |
|
46,047 |
| |||||||
Total reportable segment revenue |
320,306 |
|
284,336 |
|
514,355 |
|
454,779 |
| |||||||
Legacy, non-core and other revenue (3) |
1,518 |
|
1,516 |
|
2,644 |
|
13,562 |
| |||||||
Total revenue |
$ |
321,824 |
|
$ |
285,852 |
|
$ |
516,999 |
|
$ |
468,341 |
| |||
Net income (loss) attributable to Intrawest Resorts Holdings, Inc. |
$ |
128,694 |
|
$ |
109,478 |
|
$ |
46,646 |
|
$ |
(134,524 |
) | |||
Legacy and other non-core expenses, net (4) |
837 |
|
1,103 |
|
2,744 |
|
5,342 |
| |||||||
Other operating expenses (5) |
2,464 |
|
4,569 |
|
7,462 |
|
8,070 |
| |||||||
Depreciation and amortization |
14,767 |
|
13,969 |
|
44,065 |
|
41,111 |
| |||||||
(Gain) loss on disposal of assets and impairment of real estate |
(1,083 |
) |
212 |
|
(1,126 |
) |
632 |
| |||||||
Loss on remeasurement of equity method investment |
— |
|
— |
|
1,454 |
|
— |
| |||||||
Interest income, net (6) |
(84 |
) |
136 |
|
(172 |
) |
(1,268 |
) | |||||||
Interest expense on third party debt |
11,742 |
|
11,031 |
|
33,723 |
|
42,174 |
| |||||||
Interest expense on notes payable to affiliates |
— |
|
— |
|
— |
|
119,858 |
| |||||||
(Earnings) loss from equity method investments (7) |
(2,452 |
) |
(6,670 |
) |
305 |
|
(3,127 |
) | |||||||
Pro rata share of Adjusted EBITDA related to equity method investments (8), (9) |
1,386 |
|
9,327 |
|
3,337 |
|
11,410 |
| |||||||
Adjusted EBITDA attributable to noncontrolling interest |
(1,420 |
) |
(2,108 |
) |
(1,160 |
) |
(1,276 |
) | |||||||
Loss on extinguishment of debt |
— |
|
— |
|
— |
|
35,480 |
| |||||||
Other expense (income), net |
211 |
|
(373 |
) |
666 |
|
514 |
| |||||||
Income tax expense (benefit) |
230 |
|
77 |
|
(2,386 |
) |
374 |
| |||||||
Income attributable to noncontrolling interest |
1,099 |
|
1,514 |
|
860 |
|
860 |
| |||||||
Total Adjusted EBITDA |
$ |
156,391 |
|
$ |
142,265 |
|
$ |
136,418 |
|
$ |
125,630 |
| |||
Mountain Adjusted EBITDA (8) |
$ |
135,721 |
|
$ |
119,173 |
|
$ |
114,194 |
|
$ |
100,027 |
| |||
Adventure Adjusted EBITDA (10) |
15,449 |
|
18,815 |
|
12,767 |
|
18,183 |
| |||||||
Real Estate Adjusted EBITDA (11) |
5,221 |
|
4,277 |
|
9,457 |
|
7,420 |
| |||||||
Total Adjusted EBITDA |
$ |
156,391 |
|
$ |
142,265 |
|
$ |
136,418 |
|
$ |
125,630 |
|
(1) |
Lift revenue during the summer is derived from mountain biking and sightseeing lift products. |
23 |
(2) |
Ski School revenue during the summer is derived from mountain bike instruction at various resorts. |
(3) |
Legacy, non-core and other revenue represents legacy and other non-core operations that are not reviewed regularly by the CODM to assess performance and make decisions regarding the allocation of resources. It includes legacy real estate asset sales, non-core retail revenue and revenue from management of non-core commercial properties. Included in the nine months ended March 31, 2014 was $10.9 million of revenue from sales of non-core real estate held for development. |
(4) |
Legacy and other non-core expenses, net represents revenue and expenses of legacy and other non-core operations that are not reviewed regularly by the CODM to assess performance and make decisions regarding the allocation of resources. Revenue and expenses related to legacy and other non-core operations include retail operations not located at the Company’s properties and management of non-core commercial properties owned by third parties. It also includes legacy litigation consisting of claims for damages related to alleged construction defects, purported disclosure violations in real estate sales and marketing documents, and allegations that the Company failed to construct planned amenities. |
(5) |
Includes costs related to the Company's initial public offering, non-cash compensation, reduction in workforce severance, executive management restructuring costs, lease payments pursuant to the lease at Winter Park and other expenses. |
(6) |
Includes interest income unrelated to IRCG financing activities. |
(7) |
Represents the losses from equity method investments, including: Chateau M.T. Inc., Mammoth Hospitality Management L.L.C., the Mammoth family of resorts, and Blue Mountain prior to the Blue Mountain Acquisition. |
(8) |
Includes the Company’s pro rata share of Adjusted EBITDA from its equity method investment in Blue Mountain prior to the Blue Mountain Acquisition. The pro rata share of Adjusted EBITDA represents the share of Adjusted EBITDA from the equity method investment based on the Company’s economic ownership percentage. |
(9) |
Includes the Company’s pro rata share of EBITDA from its equity method investments in Mammoth Hospitality Management L.L.C. and Chateau M.T. Inc. The pro rata share of Adjusted EBITDA represents the Company’s share of Adjusted EBITDA from these equity method investments based on the Company's economic ownership percentages. |
(10) |
Adventure segment Adjusted EBITDA excludes Adjusted EBITDA attributable to noncontrolling interest. |
(11) |
Real Estate segment Adjusted EBITDA includes interest income earned from receivables related to the IRCG operations, in the amount of $0.9 million and $1.0 million for the three months ended March 31, 2015 and 2014, respectively, and $3.0 million and $3.4 million for the nine months ended March 31, 2015 and 2014, respectively. |
Three Months Ended March 31, |
Nine Months Ended March 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
Capital expenditures: |
||||||||||||||||
Mountain |
$ |
1,696 |
|
$ |
2,412 |
|
$ |
27,687 |
|
$ |
26,714 |
| ||||
Adventure |
645 |
|
369 |
|
3,419 |
|
6,892 |
| ||||||||
Real Estate |
18 |
|
20 |
|
245 |
|
564 |
| ||||||||
Total segment capital expenditures |
2,359 |
|
2,801 |
|
31,351 |
|
34,170 |
| ||||||||
Corporate and other |
471 |
|
1,218 |
|
3,170 |
|
2,759 |
| ||||||||
Total capital expenditures |
$ |
2,830 |
|
$ |
4,019 |
|
$ |
34,521 |
|
$ |
36,929 |
|
24 |
Three Months Ended March 31, |
Nine Months Ended March 31, | |||||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||||
Revenue: |
||||||||||||||||
United States |
$ |
201,516 |
|
$ |
189,543 |
|
$ |
313,838 |
|
|
$ |
296,613 |
| |||
Canada |
120,308 |
|
96,309 |
|
203,161 |
|
171,728 |
| ||||||||
Total revenue |
$ |
321,824 |
|
$ |
285,852 |
|
$ |
516,999 |
|
$ |
468,341 |
|
14. |
Subsequent Events |
25 |
• |
Mountain: Our Mountain segment includes our mountain resort and lodging operations at Steamboat Ski & Resort (“Steamboat”), Winter Park Resort (“Winter Park”), Stratton Mountain Resort (“Stratton”), Snowshoe Mountain Resort (“Snowshoe”), Mont Tremblant Resort (“Tremblant”), and Blue Mountain Ski Resort (“Blue Mountain”). Our Mountain segment includes our 50.0% equity interest in Blue Mountain prior to our acquisition of the remaining 50.0% equity interest in Blue Mountain on September 19, 2014 ("Blue Mountain Acquisition"). |
• |
Adventure: Our Adventure segment is comprised of CMH, which provides heli-skiing, mountaineering, and hiking in British Columbia, and our ancillary businesses that support CMH and provide commercial aviation services, such as firefighting, leasing and helicopter maintenance, repair and overhaul ("MRO") services to third parties. |
• |
Real Estate: Our Real Estate segment includes our real estate management, marketing and sales businesses, as well as our real estate development activities. The Real Estate segment includes Intrawest Resort Club Group (“IRCG”), our vacation club business, Intrawest Hospitality Management, Inc. ("IHM"), which manages condominium hotel properties and Playground, our residential real estate sales and marketing business, as well as our 50.0% interest in Mammoth Hospitality Management L.L.C. ("MHM") and 57.1% interest in Chateau M.T., Inc. ("Chateau"). |
26 |
• |
We incorrectly recognized revenue on initiation fees related to memberships in a private club. The revenue should have been recognized over the expected useful life of the private club. The impact of this error was a decrease in revenue of $0.4 million for each of the three and nine months ended March 31, 2014 and an increase in deferred revenue of $3.1 million for the year ended June 30, 2014. |
• |
We did not properly record the present value of our future liability for initiation fee refunds. The impact of this error was an increase to other long-term liabilities of $5.5 million for the year ended June 30, 2014 and a corresponding increase in interest expense of $0.2 million and $0.5 million for the three and nine months ended March 31, 2014, respectively. |
• |
We also corrected other immaterial errors including (i) timing of certain helicopter depreciation expense, (ii) amortization of deferred losses related to a terminated interest rate hedge, (iii) classification of discounts and complimentary usage on heli-skiing trips, and (iv) timing of expenses associated with a self-insurance liability. |
27 |
Three Months Ended | |||||||||||||||||||
March 31, 2015 |
December 31, 2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 | |||||||||||||||
Mountain revenue |
$ |
258,092 |
|
$ |
94,655 |
|
$ |
36,313 |
|
$ |
26,540 |
|
$ |
215,084 |
| ||||
Adventure revenue |
44,579 |
|
10,244 |
|
22,614 |
|
17,660 |
|
50,376 |
| |||||||||
Real Estate revenue |
17,635 |
|
15,152 |
|
15,071 |
|
12,482 |
|
18,876 |
| |||||||||
Total reportable segment revenue |
$ |
320,306 |
|
$ |
120,051 |
|
$ |
73,998 |
|
$ |
56,682 |
|
$ |
284,336 |
|
28 |
29 |
Three Months Ended March 31, |
Change |
Nine Months Ended March 31, |
Change | ||||||||||||||||||||||||||
2015 |
2014 |
$ |
% |
2015 |
2014 |
$ |
% | ||||||||||||||||||||||
Revenue |
$ |
321,824 |
|
$ |
285,852 |
|
$ |
35,972 |
|
12.6 |
% |
$ |
516,999 |
|
$ |
468,341 |
|
$ |
48,658 |
|
10.4 |
% | |||||||
Operating expenses |
169,523 |
|
157,474 |
|
12,049 |
|
7.7 |
% |
395,864 |
|
369,478 |
|
26,386 |
|
7.1 |
% | |||||||||||||
Depreciation and amortization |
14,767 |
|
13,969 |
|
798 |
|
5.7 |
% |
44,065 |
|
41,111 |
|
2,954 |
|
7.2 |
% | |||||||||||||
(Gain) loss on disposal of assets and impairment of real estate |
(1,083 |
) |
212 |
|
(1,295 |
) |
n/m |
|
(1,126 |
) |
632 |
|
(1,758 |
) |
n/m |
| |||||||||||||
Loss on remeasurement of equity method investment |
— |
|
— |
|
— |
|
— |
% |
1,454 |
|
— |
|
1,454 |
|
100.0 |
% | |||||||||||||
Income from operations |
138,617 |
|
114,197 |
|
24,420 |
|
21.4 |
% |
76,742 |
|
57,120 |
|
19,622 |
|
34.4 |
% | |||||||||||||
Interest expense, net |
(10,731 |
) |
(10,134 |
) |
(597 |
) |
5.9 |
% |
(30,547 |
) |
(157,413 |
) |
126,866 |
|
(80.6 |
)% | |||||||||||||
Earnings (loss) from equity method investments |
2,452 |
|
6,670 |
|
(4,218 |
) |
(63.2 |
)% |
(305 |
) |
3,127 |
|
(3,432 |
) |
(109.8 |
)% | |||||||||||||
Loss on extinguishment of debt |