Segment Information

9 Months Ended

Apr. 30, 2016

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company has three reportable segments: Mountain, Lodging and Real Estate. The Mountain segment includes the operations of the Company’s mountain resorts and Urban ski areas and related ancillary services. The Lodging segment includes the operations of all of the Company’s owned hotels in the U.S., RockResorts, NPS concessionaire properties, condominium management, CME and mountain resort golf operations. The Real Estate segment owns and develops real estate in and around the Company’s resort communities. The Company’s reportable segments, although integral to the success of each other, offer distinctly different products and services and require different types of management focus. As such, these segments are managed separately.

The Company reports its segment results using Reported EBITDA (defined as segment net revenue less segment operating expenses, plus or minus segment equity investment income or loss, plus gain on litigation settlement and for the Real Estate segment, plus gain on sale of real property), which is a non-GAAP financial measure. The Company reports segment results in a manner consistent with management’s internal reporting of operating results to the chief operating decision maker (the Chief Executive Officer) for purposes of evaluating segment performance.

Reported EBITDA is not a measure of financial performance under GAAP. Items excluded from Reported EBITDA are significant components in understanding and assessing financial performance. Reported EBITDA should not be considered in isolation or as an alternative to, or substitute for, net income, net change in cash and cash equivalents or other financial statement data presented in the Consolidated Condensed Financial Statements as indicators of financial performance or liquidity. Because Reported EBITDA is not a measurement determined in accordance with GAAP and thus is susceptible to varying calculations, Reported EBITDA as presented may not be comparable to other similarly titled measures of other companies.

The Company utilizes Reported EBITDA in evaluating performance of the Company and in allocating resources to its segments. Mountain Reported EBITDA consists of Mountain net revenue less Mountain operating expense plus or minus Mountain equity investment income or loss plus gain on litigation settlement. Lodging Reported EBITDA consists of Lodging net revenue less Lodging operating expense. Real Estate Reported EBITDA consists of Real Estate net revenue less Real Estate operating expense plus gain on sale of real property. All segment expenses include an allocation of corporate administrative expenses. Assets are not allocated between segments, or used to evaluate performance, except as shown in the table below.

The following table presents financial information by reportable segment, which is used by management in evaluating performance and allocating resources (in thousands):

	Three Months Ended April 30,						Nine Months Ended April 30,
	2016			2015			2016			2015
Net revenue:
Lift	$	334,789		$	285,249		$	642,627		$	524,537
Ski school	74,279			66,216			139,703			123,511
Dining	51,000			44,003			108,093			90,661
Retail/rental	79,384			71,078			214,748			195,563
Other	33,353			33,005			101,439			88,696
Total Mountain net revenue	572,805			499,551			1,206,610			1,022,968
Lodging	72,933			67,323			200,026			185,180
Total Resort net revenue	645,738			566,874			1,406,636			1,208,148
Real estate	1,734			12,469			14,766			29,694
Total net revenue	$	647,472		$	579,343		$	1,421,402		$	1,237,842
Operating expense:
Mountain	$	281,968		$	244,675		$	729,382		$	645,593
Lodging	57,422			54,726			176,170			166,407
Total Resort operating expense	339,390			299,401			905,552			812,000
Real estate	3,085			14,028			17,043			35,513
Total segment operating expense	$	342,475		$	313,429		$	922,595		$	847,513
Gain on litigation settlement	$	—		$	—		$	—		$	16,400
Gain on sale of real property	19			151			1,810			151
Mountain equity investment income (loss), net	211			(129		)	992			396
Reported EBITDA:
Mountain	$	291,048		$	254,747		$	478,220		$	394,171
Lodging	15,511			12,597			23,856			18,773
Resort	306,559			267,344			502,076			412,944
Real estate	(1,332		)	(1,408		)	(467		)	(5,668		)
Total Reported EBITDA	$	305,227		$	265,936		$	501,609		$	407,276
Real estate held for sale and investment	$	116,874		$	137,740		$	116,874		$	137,740
Reconciliation to net income attributable to Vail Resorts, Inc.:
Total Reported EBITDA	$	305,227		$	265,936		$	501,609		$	407,276
Depreciation and amortization	(41,472		)	(38,242		)	(120,713		)	(111,587		)
Change in fair value of Contingent Consideration	—			—			—			4,550
Loss on disposal of fixed assets and other, net	(164		)	(71		)	(3,149		)	(852		)
Investment income, net	150			119			509			155
Interest expense	(10,400		)	(13,735		)	(31,905		)	(41,110		)
Income before provision for income taxes	253,341			214,007			346,351			258,432
Provision for income taxes	(95,804		)	(80,605		)	(131,613		)	(73,654		)
Net income	$	157,537		$	133,402		$	214,738		$	184,778
Net loss attributable to noncontrolling interests	95			8			289			118
Net income attributable to Vail Resorts, Inc.	$	157,632		$	133,410		$	215,027		$	184,896