Guarantor Subsidiaries and Non-Guarantor Subsidiaries

The Company’s payment obligations under the 6.50% Notes (see Note 4, Long-Term Debt) are fully and unconditionally guaranteed on a joint and several, senior subordinated basis by substantially all of the Company’s consolidated subsidiaries (collectively, and excluding Non-Guarantor Subsidiaries (as defined below), the “Guarantor Subsidiaries”), except for Eagle Park Reservoir Company, Larkspur Restaurant & Bar, LLC, Black Diamond Insurance, Inc., Skiinfo AS and certain other insignificant entities (together, the “Non-Guarantor Subsidiaries”). APII and the Employee Housing Entities are included with the Non-Guarantor Subsidiaries for purposes of the consolidated financial information, but are not considered subsidiaries under the indenture governing the 6.50% Notes.

Presented below is the consolidated financial information of the Parent Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries. Financial information for the Non-Guarantor Subsidiaries is presented in the column titled “Other Subsidiaries.” Balance sheets are presented as of January 31, 2014, July 31, 2013, and January 31, 2013. Statements of operations and statements of comprehensive income (loss) are presented for the three and six months ended January 31, 2014 and 2013. Statements of cash flows are presented for the six months ended January 31, 2014 and 2013. As of January 31, 2013, the Company revised its classification of advances from affiliates in the amount of $446.3 million to present it separately in the Supplemental Condensed Consolidating Balance Sheet from advances to affiliates. The Company has determined that this revision is not material to the Supplemental Condensed Consolidating Balance Sheet. In addition, the Company revised its classification of accounts payable and accrued liabilities related to purchases of property, plant and equipment in the Supplemental Condensed Consolidating Statement of Cash Flows from a gross basis to a net basis for the six months ended January 31, 2013 (see Note 2, Summary of Significant Accounting Policies). The Company determined that this revision is not material to the Supplemental Condensed Consolidating Statement of Cash Flows.

Investments in subsidiaries are accounted for by the Parent Company and Guarantor Subsidiaries using the equity method of accounting. Net income (loss) of Guarantor and Non-Guarantor Subsidiaries is, therefore, reflected in the Parent Company’s and Guarantor Subsidiaries’ investments in and advances to (from) subsidiaries. Net income (loss) of the Guarantor and Non-Guarantor Subsidiaries is reflected in Guarantor Subsidiaries and Parent Company as equity in consolidated subsidiaries. The elimination entries eliminate investments in Other Subsidiaries and intercompany balances and transactions for consolidated reporting purposes.

Supplemental Condensed Consolidating Balance Sheet

As of January 31, 2014

(in thousands)

(Unaudited)



	Parent Company		100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Current assets:
Cash and cash equivalents	$	—	$	197,363		$	7,913		$	—		$	205,276
Restricted cash	—		11,188			1,754			—			12,942
Trade receivables, net	—		53,833			3,840			—			57,673
Inventories, net	—		72,233			270			—			72,503
Other current assets	27,885		26,090			526			—			54,501
Total current assets	27,885		360,707			14,303			—			402,895
Property, plant and equipment, net	—		1,143,884			43,905			—			1,187,789
Real estate held for sale and investment	—		184,101			—			—			184,101
Goodwill, net	—		344,615			1,671			—			346,286
Intangible assets, net	—		100,116			19,344			—			119,460
Other assets	5,529		101,201			4,172			(9,459		)	101,443
Investments in subsidiaries	1,851,623		(5,134		)	—			(1,846,489		)	—
Advances to affiliates	—		538,318			3,116			(541,434		)	—
Total assets	$	1,885,037	$	2,767,808		$	86,511		$	(2,397,382	)	$	2,341,974
Current liabilities:
Accounts payable and accrued liabilities	$	6,549	$	353,215		$	9,444		$	—		$	369,208
Income taxes payable	39,543		—			—			—			39,543
Long-term debt due within one year	—		734			231			—			965
Total current liabilities	46,092		353,949			9,675			—			409,716
Advances from affiliates	541,434		—			—			(541,434		)	—
Long-term debt	390,000		350,812			57,507			—			798,319
Other long-term liabilities	27,673		211,424			10,588			(9,459		)	240,226
Deferred income taxes	79,771		—			(115		)	—			79,656
Total Vail Resorts, Inc. stockholders’ equity (deficit)	800,067		1,851,623			(5,134		)	(1,846,489		)	800,067
Noncontrolling interests	—		—			13,990			—			13,990
Total stockholders’ equity	800,067		1,851,623			8,856			(1,846,489		)	814,057
Total liabilities and stockholders’ equity	$	1,885,037	$	2,767,808		$	86,511		$	(2,397,382	)	$	2,341,974

Supplemental Condensed Consolidating Balance Sheet

As of July 31, 2013

(in thousands)

(Unaudited)



	Parent Company		100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Current assets:
Cash and cash equivalents	$	—	$	130,970		$	7,634		$	—		$	138,604
Restricted cash	—		10,890			1,734			—			12,624
Trade receivables, net	—		77,725			1,312			—			79,037
Inventories, net	—		68,101			217			—			68,318
Other current assets	25,190		18,475			1,221			—			44,886
Total current assets	25,190		306,161			12,118			—			343,469
Property, plant and equipment, net	—		1,124,004			45,284			—			1,169,288
Real estate held for sale and investment	—		195,230			—			—			195,230
Goodwill, net	—		347,078			1,746			—			348,824
Intangible assets, net	—		101,913			19,431			—			121,344
Other assets	6,057		96,337			4,332			(9,459		)	97,267
Investments in subsidiaries	1,861,509		(3,510		)	—			(1,857,999		)	—
Advances to affiliates	—		513,283			2,906			(516,189		)	—
Total assets	$	1,892,756	$	2,680,496		$	85,817		$	(2,383,647	)	$	2,275,422
Current liabilities:
Accounts payable and accrued liabilities	$	6,600	$	256,094		$	6,825		$	—		$	269,519
Income taxes payable	42,822		—			—			—			42,822
Long-term debt due within one year	—		775			219			—			994
Total current liabilities	49,422		256,869			7,044			—			313,335
Advances from affiliates	516,189		—			—			(516,189		)	—
Long-term debt	390,000		348,190			57,738			—			795,928
Other long-term liabilities	27,851		213,928			10,586			(9,459		)	242,906
Deferred income taxes	85,426		—			(42		)	—			85,384
Total Vail Resorts, Inc. stockholders’ equity (deficit)	823,868		1,861,509			(3,510		)	(1,857,999		)	823,868
Noncontrolling interests	—		—			14,001			—			14,001
Total stockholders’ equity	823,868		1,861,509			10,491			(1,857,999		)	837,869
Total liabilities and stockholders’ equity	$	1,892,756	$	2,680,496		$	85,817		$	(2,383,647	)	$	2,275,422

Supplemental Condensed Consolidating Balance Sheet

As of January 31, 2013

(in thousands)

(Unaudited)



	Parent Company		100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Current assets:
Cash and cash equivalents	$	—	$	129,258		$	7,321		$	—		$	136,579
Restricted cash	—		10,979			1,215			—			12,194
Trade receivables, net	—		49,475			4,011			—			53,486
Inventories, net	—		70,095			246			—			70,341
Other current assets	27,586		20,988			1,059			—			49,633
Total current assets	27,586		280,795			13,852			—			322,233
Property, plant and equipment, net	—		1,010,349			47,050			—			1,057,399
Real estate held for sale and investment	—		216,815			—			—			216,815
Goodwill, net	—		269,875			1,887			—			271,762
Intangible assets, net	—		73,022			19,568			—			92,590
Other assets	6,573		41,469			4,367			(9,459		)	42,950
Investments in subsidiaries	1,788,271		(1,798		)	—			(1,786,473		)	—
Advances to affiliates	—		443,135			3,168			(446,303		)	—
Total assets	$	1,822,430	$	2,333,662		$	89,892		$	(2,242,235	)	$	2,003,749
Current liabilities:
Accounts payable and accrued liabilities	$	6,502	$	302,077		$	8,925		$	—		$	317,504
Income taxes payable	14,979		—			—			—			14,979
Long-term debt due within one year	—		587			219			—			806
Total current liabilities	21,481		302,664			9,144			—			333,289
Advances from affiliates	446,303		—			—			(446,303		)	—
Long-term debt	390,000		41,759			57,738			—			489,497
Other long-term liabilities	28,050		200,968			10,598			(9,459		)	230,157
Deferred income taxes	140,582		—			122			—			140,704
Total Vail Resorts, Inc. stockholders’ equity (deficit)	796,014		1,788,271			(1,798		)	(1,786,473		)	796,014
Noncontrolling interests	—		—			14,088			—			14,088
Total stockholders’ equity	796,014		1,788,271			12,290			(1,786,473		)	810,102
Total liabilities and stockholders’ equity	$	1,822,430	$	2,333,662		$	89,892		$	(2,242,235	)	$	2,003,749

Supplemental Condensed Consolidating Statement of Operations

For the three months ended January 31, 2014

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Total net revenue	$	—		$	449,949		$	6,531		$	(3,760	)	$	452,720
Total operating expense	88			339,480			6,179			(3,722		)	342,025
(Loss) income from operations	(88		)	110,469			352			(38		)	110,695
Other expense, net	(6,601		)	(9,202		)	(404		)	38			(16,169		)
Equity investment income, net	—			14			—			—			14
(Loss) income before benefit (provision) for income taxes	(6,689		)	101,281			(52		)	—			94,540
Benefit (provision) for income taxes	2,398			(37,666		)	(72		)	—			(35,340		)
Net (loss) income before equity in income (loss) of consolidated subsidiaries	(4,291		)	63,615			(124		)	—			59,200
Equity in income (loss) of consolidated subsidiaries	63,554			(61		)	—			(63,493		)	—
Net income (loss)	59,263			63,554			(124		)	(63,493		)	59,200
Net loss attributable to noncontrolling interests	—			—			63			—			63
Net income (loss) attributable to Vail Resorts, Inc.	$	59,263		$	63,554		$	(61	)	$	(63,493	)	$	59,263

Supplemental Condensed Consolidating Statement of Operations

For the three months ended January 31, 2013

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Total net revenue	$	—		$	419,427		$	6,363		$	(3,339	)	$	422,451
Total operating expense	105			313,727			5,957			(3,301		)	316,488
(Loss) income from operations	(105		)	105,700			406			(38		)	105,963
Other expense, net	(6,600		)	(1,521		)	(352		)	38			(8,435		)
Equity investment income, net	—			99			—			—			99
(Loss) income before benefit (provision) for income taxes	(6,705		)	104,278			54			—			97,627
Benefit (provision) for income taxes	2,547			(39,564		)	(81		)	—			(37,098		)
Net (loss) income before equity in income (loss) of consolidated subsidiaries	(4,158		)	64,714			(27		)	—			60,529
Equity in income (loss) of consolidated subsidiaries	64,709			(5		)	—			(64,704		)	—
Net income (loss)	60,551			64,709			(27		)	(64,704		)	60,529
Net loss attributable to noncontrolling interests	—			—			22			—			22
Net income (loss) attributable to Vail Resorts, Inc.	$	60,551		$	64,709		$	(5	)	$	(64,704	)	$	60,551

Supplemental Condensed Consolidating Statement of Operations

For the six months ended January 31, 2014

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Total net revenue	$	—		$	573,437		$	9,346		$	(6,672	)	$	576,111
Total operating expense	180			563,008			10,928			(6,596		)	567,520
(Loss) income from operations	(180		)	10,429			(1,582		)	(76		)	8,591
Other expense, net	(13,202		)	(18,299		)	(747		)	76			(32,172		)
Equity investment income, net	—			617			—			—			617
Loss before benefit from income taxes	(13,382		)	(7,253		)	(2,329		)	—			(22,964		)
Benefit from income taxes	5,246			3,324			157			—			8,727
Net loss before equity in loss of consolidated subsidiaries	(8,136		)	(3,929		)	(2,172		)	—			(14,237		)
Equity in loss of consolidated subsidiaries	(5,977		)	(2,048		)	—			8,025			—
Net loss	(14,113		)	(5,977		)	(2,172		)	8,025			(14,237		)
Net loss attributable to noncontrolling interests	—			—			124			—			124
Net loss attributable to Vail Resorts, Inc.	$	(14,113	)	$	(5,977	)	$	(2,048	)	$	8,025		$	(14,113	)

Supplemental Condensed Consolidating Statement of Operations

For the six months ended January 31, 2013

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Total net revenue	$	—		$	535,431		$	9,374		$	(6,004	)	$	538,801
Total operating expense	218			518,085			10,762			(5,928		)	523,137
(Loss) income from operations	(218		)	17,346			(1,388		)	(76		)	15,664
Other expense, net	(13,210		)	(2,935		)	(687		)	76			(16,756		)
Equity investment income, net	—			533			—			—			533
(Loss) income before benefit (provision) for income taxes	(13,428		)	14,944			(2,075		)	—			(559		)
Benefit (provision) for income taxes	5,157			(4,773		)	101			—			485
Net (loss) income before equity in income (loss) of consolidated subsidiaries	(8,271		)	10,171			(1,974		)	—			(74		)
Equity in income (loss) of consolidated subsidiaries	8,242			(1,929		)	—			(6,313		)	—
Net (loss) income	(29		)	8,242			(1,974		)	(6,313		)	(74		)
Net loss attributable to noncontrolling interests	—			—			45			—			45
Net (loss) income attributable to Vail Resorts, Inc.	$	(29	)	$	8,242		$	(1,929	)	$	(6,313	)	$	(29	)

Supplemental Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended January 31, 2014

(In thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries			Consolidated
Net income (loss)	$	59,263		$	63,554		$	(124	)	$	(63,493	)	$	59,200
Foreign currency translation adjustments, net of tax	(130		)	(130		)	(130		)	260			(130		)
Comprehensive income (loss)	59,133			63,424			(254		)	(63,233		)	59,070
Comprehensive loss attributable to noncontrolling interests	—			—			63			—			63
Comprehensive income (loss) attributable to Vail Resorts, Inc.	$	59,133		$	63,424		$	(191	)	$	(63,233	)	$	59,133

Supplemental Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended January 31, 2013

(In thousands)

(Unaudited)



	Parent Company		100% Owned Guarantor Subsidiaries		Other Subsidiaries			Eliminating Entries			Consolidated
Net income (loss)	$	60,551	$	64,709	$	(27	)	$	(64,704	)	$	60,529
Foreign currency translation adjustments, net of tax	159		159		159			(318		)	159
Comprehensive income	60,710		64,868		132			(65,022		)	60,688
Comprehensive loss attributable to noncontrolling interests	—		—		22			—			22
Comprehensive income attributable to Vail Resorts, Inc.	$	60,710	$	64,868	$	154		$	(65,022	)	$	60,710

Supplemental Condensed Consolidating Statement of Comprehensive Income (Loss)

For the six months ended January 31, 2014

(In thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Eliminating Entries		Consolidated
Net loss	$	(14,113	)	$	(5,977	)	$	(2,172	)	$	8,025	$	(14,237	)
Foreign currency translation adjustments, net of tax	(119		)	(119		)	(119		)	238		(119		)
Comprehensive loss	(14,232		)	(6,096		)	(2,291		)	8,263		(14,356		)
Comprehensive loss attributable to noncontrolling interests	—			—			124			—		124
Comprehensive loss attributable to Vail Resorts, Inc.	$	(14,232	)	$	(6,096	)	$	(2,167	)	$	8,263	$	(14,232	)

Supplemental Condensed Consolidating Statement of Comprehensive Income (Loss)

For the six months ended January 31, 2013

(In thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries		Other Subsidiaries			Eliminating Entries			Consolidated
Net (loss) income	$	(29	)	$	8,242	$	(1,974	)	$	(6,313	)	$	(74	)
Foreign currency translation adjustments, net of tax	453			453		453			(906		)	453
Comprehensive income (loss)	424			8,695		(1,521		)	(7,219		)	379
Comprehensive loss attributable to noncontrolling interests	—			—		45			—			45
Comprehensive income (loss) attributable to Vail Resorts, Inc.	$	424		$	8,695	$	(1,476	)	$	(7,219	)	$	424

Supplemental Condensed Consolidating Statement of Cash Flows

For the six months ended January 31, 2014

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Consolidated
Net cash (used in) provided by operating activities	$	(19,616	)	$	193,841		$	396		$	174,621
Cash flows from investing activities:
Capital expenditures	—			(93,095		)	(676		)	(93,771		)
Other investing activities, net	—			142			7			149
Net cash used in investing activities	—			(92,953		)	(669		)	(93,622		)
Cash flows from financing activities:
Dividends paid	(14,986		)	—			—			(14,986		)
Other financing activities, net	3,390			(3,265		)	496			621
Advances	31,212			(31,212		)	—			—
Net cash provided by (used in) financing activities	19,616			(34,477		)	496			(14,365		)
Effect of exchange rate changes on cash and cash equivalents	—			(18		)	56			38
Net increase in cash and cash equivalents	—			66,393			279			66,672
Cash and cash equivalents:
Beginning of period	—			130,970			7,634			138,604
End of period	$	—		$	197,363		$	7,913		$	205,276

Supplemental Condensed Consolidating Statement of Cash Flows

For the six months ended January 31, 2013

(in thousands)

(Unaudited)



	Parent Company			100% Owned Guarantor Subsidiaries			Other Subsidiaries			Consolidated
Net cash (used in) provided by operating activities	$	(14,033	)	$	189,812		$	(135	)	$	175,644
Cash flows from investing activities:
Capital expenditures	—			(57,752		)	(535		)	(58,287		)
Acquisition of businesses	—			(19,958		)	—			(19,958		)
Other investing activities, net	—			228			18			246
Net cash used in investing activities	—			(77,482		)	(517		)	(77,999		)
Cash flows from financing activities:
Proceeds from borrowings under other long-term debt	—			96,000			—			96,000
Payments of other long-term debt	—			(96,236		)	(208		)	(96,444		)
Dividends paid	(13,458		)	—			—			(13,458		)
Other financing activities, net	3,934			2,585			203			6,722
Advances	23,557			(23,801		)	244			—
Net cash provided by (used in) financing activities	14,033			(21,452		)	239			(7,180		)
Effect of exchange rate changes on cash and cash equivalents	—			—			61			61
Net increase (decrease) in cash and cash equivalents	—			90,878			(352		)	90,526
Cash and cash equivalents:
Beginning of period	—			38,380			7,673			46,053
End of period	$	—		$	129,258		$	7,321		$	136,579