Net Income Per Common Share

6 Months Ended

Jan. 31, 2019

Earnings Per Share Reconciliation [Abstract]

Summary of Calculation of Basic And Diluted EPS

	Three Months Ended January 31,
	2019				2018
	Basic		Diluted		Basic		Diluted
Net income per share:
Net income attributable to Vail Resorts	$	206,349	$	206,349	$	235,691	$	235,691
Weighted-average Vail Shares outstanding	40,271		40,271		40,414		40,414
Weighted-average Exchangeco Shares outstanding	57		57		61		61
Total Weighted-average shares outstanding	40,328		40,328		40,475		40,475
Effect of dilutive securities	—		798		—		1,119
Total shares	40,328		41,126		40,475		41,594
Net income per share attributable to Vail Resorts	$	5.12	$	5.02	$	5.82	$	5.67

The Company computes the effect of dilutive securities using the treasury stock method and average market prices during the period. The number of shares issuable upon the exercise of share based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 56,000 and 5,000 for the three months ended January 31, 2019 and 2018, respectively.

Presented below is basic and diluted EPS for the six months ended January 31, 2019 and 2018 (in thousands, except per share amounts):

	Six Months Ended January 31,
	2019				2018
	Basic		Diluted		Basic		Diluted
Net income per share:
Net income attributable to Vail Resorts	$	98,554	$	98,554	$	207,306	$	207,306
Weighted-average Vail Shares outstanding	40,359		40,359		40,281		40,281
Weighted-average Exchangeco Shares outstanding	57		57		62		62
Total Weighted-average shares outstanding	40,416		40,416		40,343		40,343
Effect of dilutive securities	—		870		—		1,346
Total shares	40,416		41,286		40,343		41,689
Net income per share attributable to Vail Resorts	$	2.44	$	2.39	$	5.14	$	4.97

The number of shares issuable upon the exercise of share based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 40,000 and 5,000 for the six months ended January 31, 2019 and 2018, respectively.

Net Income Per Common Share

Net Income per Share

Earnings per Share

Basic earnings per share (“EPS”) excludes dilution and is computed by dividing net income attributable to Vail Resorts stockholders by the weighted-average shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised, resulting in the issuance of shares of common stock that would then share in the earnings of Vail Resorts.

In connection with the Company’s acquisition of Whistler Blackcomb in October 2016, the Company issued consideration in the form of shares of Vail Resorts common stock (the “Vail Shares”) and shares of the Company’s wholly-owned Canadian subsidiary (“Exchangeco”). Whistler Blackcomb shareholders elected to receive 3,327,719 Vail Shares and 418,095 shares of Exchangeco (the “Exchangeco Shares”). Both Vail Shares and Exchangeco Shares have a par value of $0.01 per share, and Exchangeco Shares, while outstanding, are substantially the economic equivalent of Vail Shares and are exchangeable, at any time prior to the seventh anniversary of the closing of the acquisition, into Vail Shares. The Company’s calculation of weighted-average shares outstanding includes the Exchangeco Shares.

Presented below is basic and diluted EPS for the three months ended January 31, 2019 and 2018 (in thousands, except per share amounts):

	Three Months Ended January 31,
	2019				2018
	Basic		Diluted		Basic		Diluted
Net income per share:
Net income attributable to Vail Resorts	$	206,349	$	206,349	$	235,691	$	235,691
Weighted-average Vail Shares outstanding	40,271		40,271		40,414		40,414
Weighted-average Exchangeco Shares outstanding	57		57		61		61
Total Weighted-average shares outstanding	40,328		40,328		40,475		40,475
Effect of dilutive securities	—		798		—		1,119
Total shares	40,328		41,126		40,475		41,594
Net income per share attributable to Vail Resorts	$	5.12	$	5.02	$	5.82	$	5.67

The Company computes the effect of dilutive securities using the treasury stock method and average market prices during the period. The number of shares issuable upon the exercise of share based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 56,000 and 5,000 for the three months ended January 31, 2019 and 2018, respectively.

Presented below is basic and diluted EPS for the six months ended January 31, 2019 and 2018 (in thousands, except per share amounts):

	Six Months Ended January 31,
	2019				2018
	Basic		Diluted		Basic		Diluted
Net income per share:
Net income attributable to Vail Resorts	$	98,554	$	98,554	$	207,306	$	207,306
Weighted-average Vail Shares outstanding	40,359		40,359		40,281		40,281
Weighted-average Exchangeco Shares outstanding	57		57		62		62
Total Weighted-average shares outstanding	40,416		40,416		40,343		40,343
Effect of dilutive securities	—		870		—		1,346
Total shares	40,416		41,286		40,343		41,689
Net income per share attributable to Vail Resorts	$	2.44	$	2.39	$	5.14	$	4.97

The number of shares issuable upon the exercise of share based awards excluded from the calculation of diluted EPS because the effect of their inclusion would have been anti-dilutive totaled approximately 40,000 and 5,000 for the six months ended January 31, 2019 and 2018, respectively.

Net income attributable to Vail Resorts decreased by approximately $108.8 million for the six months ended January 31, 2019 compared to the prior year primarily due to a decrease in excess tax benefits of $48.4 million, which resulted primarily from employee exercises of in-the-money stock appreciation rights, and a one-time, provisional net tax benefit of approximately $64.6 million recorded during the three and six months ended January 31, 2018, which was the result of comprehensive U.S. tax legislation, commonly referred to as the “Tax Act,” which was enacted by the U.S. government on December 22, 2017. Both of these items were recorded within (provision) benefit from income taxes on the Company’s Consolidated Condensed Statement of Operations.

Dividends

During the three and six months ended January 31, 2019, the Company paid cash dividends of $1.47 and $2.94 per share, respectively ($59.2 million and $118.7 million, respectively, in the aggregate). During the three and six months ended January 31, 2018, the Company paid cash dividends of $1.053 and $2.106 per share, respectively ($42.6 million and $85.2 million, respectively, in the aggregate). On March 7, 2019, the Company’s Board of Directors declared a quarterly cash dividend of $1.76 per share for Vail Shares, payable on April 11, 2019 to stockholders of record as of March 27, 2019. Additionally, a Canadian dollar equivalent dividend on the Exchangeco Shares will be payable on April 11, 2019 to the shareholders of record on March 27, 2019.